Income tax: Marriage splitting also applies to registered civil partnerships

Background of the Case

The applicant, a partner in a registered civil partnership, applied to the competent tax office for joint assessment in accordance with Sections 26 (1) sentence 1 and 26b of the German Income Tax Act (EStG). The tax office originally granted joint assessment, but changed its decision in the course of an objection procedure and carried out an individual assessment instead. The applicant then applied to the court for a stay of execution on the grounds that the unequal treatment of marriage and registered partnerships was unconstitutional.

2. legal situation and reasoning of the tax office

The tax office based its decision on the statutory provisions of the Income Tax Act. These stipulate that spousal splitting is reserved exclusively for married couples. The legislator has clearly stipulated that joint taxation only applies to marriages and cannot be extended to registered civil partnerships. According to the tax office, an analogous application of the regulations for civil partnerships is ruled out, as there is no unintended loophole in the law.

3. argumentation of the applicant and constitutional concerns

The applicant argued in court that the exclusion of registered civil partnerships from joint taxation violated the principle of equality in the German Basic Law. She pointed out that the Federal Constitutional Court demands a strict equality test in cases in which the legislator makes differentiations based on sexual orientation. The choice between marriage and a registered civil partnership is closely linked to sexual orientation, meaning that the unequal treatment in tax law practice constitutes discrimination on the basis of sexual identity.

4th decision of the Lower Saxony Fiscal Court

The Lower Saxony Tax Court followed the applicant's arguments. In a rough examination of the provisional legal protection, it found that there were serious doubts about the legality of the administrative act. Although the court conceded that the wording of the relevant tax regulations restricted joint assessment to spouses, the exclusion of registered civil partnerships was unconstitutional. The court found that there was no sufficient difference between marriage and registered partnerships to justify such unequal treatment.

5 Constitutional assessment and conclusion

The court referred in particular to the case law of the Federal Constitutional Court, according to which the unequal treatment of persons on the basis of their sexual orientation can only be justified by weighty reasons. As marriage and registered civil partnerships are both legally established, long-term partnerships, there are insufficient differences to justify unequal treatment under tax law. The special requirement to protect marriage and family under Art. 6 para. 1 GG also does not justify such unequal treatment if this leads to discrimination against other forms of life.

Overall, the Lower Saxony Fiscal Court found that the unequal tax treatment was not constitutionally tenable and ruled in favour of the applicant in the context of interim legal protection.