Service content
Description of the
Under the Act amending the Local Taxes Act of 26 June 2018 (GVBl. No. 12 of 29 June 2018, p. 449 et seq.), the Bavarian State Parliament repealed the legal basis for the levying of road development contributions in Article 5(1), third sentence, and Article 5b of the Local Taxes Act (KAG) with effect from 1 January 2018 and replaced it with a provision in Article 5(1), third sentence, of the KAG, according to which, from that date onwards, contributions for measures relating to the renewal and improvement of local roads, public paths with restricted access, sections of through-roads within local authority jurisdiction, and street lighting (road improvement contribution measures) (see LT-Drs. 17/21586).
This provision applies to cases in which the material contribution obligations had not yet arisen at the time the Act came into force. To ensure that contributions can no longer be levied even in cases where, at the time the Act came into force, the material contribution obligations had arisen but the personal contribution obligations had not yet arisen, accompanying provisions are set out in Article 19(7) of the KAG. In addition, transitional provisions in Article 19(8) of the KAG address the treatment of advance payments assessed prior to 1 January 2018.
This Act does not affect the right and duty of local authorities to levy development contributions under Article 5a of the KAG.
Deadlines
Road construction contributions, much like development contributions, could reach a considerable amount.
If the collection of the levy from the person liable to pay – even following the abolition of road improvement levies on 31 December 2017 – results in particular hardship, it is within the municipalities’ discretion, in accordance with their duties, to alleviate this through measures of equity, such as payment by instalments, spreading payments over time, deferral or remission – in a socially responsible manner. The person liable for the contribution may submit an application to their local authority for this purpose.
Under Article 19a of the KAG, the Free State of Bavaria established a hardship fund with a one-off allocation of €50 million to provide proportionate compensation for certain hardships arising from road development contributions levied between 1 January 2014 and 31 December 2017. An independent commission, not bound by any technical directives, decided on the granting of benefits. Applications for hardship relief could only be submitted until 31 December 2019.
Legal basis
- Section 5 of the Local Taxes Act (KAG)
Articles
- Section 19 of the Local Taxes Act (KAG)
Transitional arrangements
- Section 222 of the German Fiscal Code (AO)
Deferral
- Section 227 of the German Fiscal Code (AO)
Decree
- Section 5 of the Local Taxes Act (KAG)
Further links