Lucrative but expensive: tax audits for the rich are falling sharply

Lucrative but expensive
Tax audits among the rich are falling sharply

Sometimes the tax office wants to take a closer look at the bookkeeping: Tax audits can happen not only to freelancers and entrepreneurs, but also to private individuals with high incomes. But the tax officials have recently become less and less interested in them.

According to a newspaper report, those who earn more than 500,000 euros per year are examined less and less by the tax authorities. The number of so-called tax office audits for taxpayers with income of over half a million euros has decreased significantly from 1628 in 2009 to currently only 909 in 2020 – a decrease of almost 56 percent. This emerges from the answer of the Federal Ministry of Finance to a small question from the Left parliamentary group, from which the newspaper “Rheinische Post” reports.

This escaped a closer examination, especially those citizens whose tax returns are particularly complex due to their high income and wealth and for whom tax avoidance tricks are likely to be particularly worthwhile. The Federal Audit Office had already warned in 2006 that audits were too low for the rich and the super-rich. Inspections of this group could lead to an average additional income of 130,000 euros per year, according to the authority at the time.

According to the newspaper report, the federal government refers to the corona crisis in 2020: The responsible countries had avoided more frequent contacts to protect tax officials and taxpayers, which had an impact on the audits. However, according to the report, the number of tax audits on the rich fell sharply before the pandemic. It fell by almost 30 percent compared to 2009 to 1150 in 2018.