1. INTRODUCTION

Inheritance taxes can be traced back to ancient Egypt and have been around in Germany since 1873. As in other countries, inheritance (or: estate) taxes are subject to constant political debate and changes. Today, German inheritance and gift taxes rates are as high as 50%, but tax-exemptions for the transfer of business assets have been introduced in order to not strangulate family-owned businesses. On 17 December 2014 the German constitutional court held the German Inheritance and Gift Tax Law (Erbschaftsteuergesetz, ErbStG) to be unconstitutional. According to the ruling, the treatment of specific types of assets by the legislator was not in line with the imperative of equal treatment of taxpayers, pursuant to Article 3 of the German constitution. Hence, in order to remain in force, the ErbStG needs to be amended until the end of 30 June 2016. The latest revision (not the first one!) is already under way.

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