Inheritance Tax Under Scrutiny: What Might Change Now

Since 1995, the Federal Constitutional Court in Karlsruhe has ruled on the inheritance tax three times, and on each occasion, the justices have declared parts of the regulations unconstitutional. Now the next revision may be on the horizon: As the court announced, two cases are scheduled for oral arguments on October 12 and 13. The ruling will have been handed down by the time our event takes place. Should the eight justices overturn a provision, the legislature will have to make amendments. The extent of the reform is uncertain and politically sensitive.

Tobias Engelmann (PwC), Alexander Erhardt (PwC), and Dr. Eberhard Sasse (Sasse Group) will discuss these and other questions at the Bergson Academy. The event offers you the opportunity for in-depth analysis, diverse perspectives from politics and practice, and an open discussion about the future of inheritance tax in Germany.

About the proceedings:

First Procedure: Privileges for Business Assets

The first case concerns the tax advantages enjoyed by heirs of business assets. They are treated more favorably than heirs of personal assets, and very large business assets may even be exempt from taxation. One heir considers this unfair and has filed a constitutional complaint. He had inherited, among other things, a securities portfolio and real estate from his aunt and had previously failed in his appeal against the tax assessment. In his view, as an heir to personal assets, he is treated unequally compared to heirs of businesses.

Heirs of business assets remain largely tax-exempt if they continue to operate the business and can pay the tax from their own funds. The legislature intended this to prevent jobs and investments from being lost due to the tax burden. For very large estates, which usually also include business assets, the law even provides for a complete exemption. As a result, the wealthiest estates pay little or no inheritance tax, not least thanks to clever arrangements such as foundations.

Second Proceeding: Bavaria’s Lawsuit

In the second case, the Bavarian state government is the petitioner. In its view, the exemption amounts for inheritances and gifts no longer align with real estate prices in the southern part of the state. With its application for a constitutional review, it is therefore challenging the provisions governing the valuation of real property, as well as the personal exemption amounts and tax rates in the Inheritance and Gift Tax Act. Bavaria considers these rules unconstitutional and is asserting its right to establish its own regulations. The First Senate must determine whether legislative authority lies with the federal government or whether the states themselves may determine the threshold above which inheritances and gifts are taxed (tax-free allowance) and the applicable tax rate (Case No. 1 BvF 1/23, hearing on October 12, 2026).

Doors open: 6:00 p.m.

Start: 7:00 p.m.

End: 8:30 p.m.

Fair-Price Ticket: 20 EUR

Ensures fair compensation for everyone involved. If it’s feasible for you, we’d appreciate it if you’d choose this ticket.

Social-Price Ticket: 15 EUR

This ticket makes it possible for you to participate in cultural events—even if you have limited financial resources.

Support-Price Ticket: 25 EUR

With this ticket, you help make culture accessible to everyone and support our Social-Price model.