Federal Minister of Finance Lars Klingbeil (SPD) has announced plans for new measures aimed at tightening regulations against tax fraud. Speaking to the Funke media group, the Deputy Chancellor stressed that self-disclosure should no longer guarantee immunity from punishment. He stated that criminals should not be able to “buy their freedom” so easily, emphasizing that no one should assume that if they suspect tax evasion, merely submitting a self-disclosure will free them from criminal charges. Klingbeil insisted that the rule of law must be upheld, noting that the massive financial damages caused by tax fraud are borne by all citizens.
Currently, tax evasion is punishable by a fine or up to five years in prison. However, existing law, specifically Statute 371 of the Fiscal Code, allows individuals to avoid prosecution if the tax authorities are informed of the inaccurate data and the individual corrects it themselves. The underlying principle is to encourage tax evaders to return to honesty. Nevertheless, the Ministry of Finance now contends that this existing immunity creates a “false incentive” encouraging people to commit evasion and only disclose it after the crime is already done.
Minister Klingbeil aims to eliminate this false incentive. The Ministry plans to propose a legal change stipulating that, going forward, self-disclosures submitted above certain financial thresholds will only count as mitigating evidence, but will no longer result in complete immunity. Klingbeil reaffirmed the principle, stating, “We must protect those who follow the rules. The honest people cannot be the ones at a disadvantage”.
According to the Ministry, this move is part of a comprehensive action plan designed to better combat tax crime. The initiative also includes upgrading the “Special Unit for Tax Evasion” at the Federal Central Tax Office. In the future, tax authority data will be centrally stored on a dedicated platform and analyzed using Artificial Intelligence.
Klingbeil concluded by issuing a clear deterrent signal: “The message to tax evaders must be: Do not try it. We will catch you”. Furthermore, the Ministry of Finance has requested a stronger federal role in acquiring tax data. To facilitate this, a “tipline portal as a central contact point” will reportedly be established at the Federal Central Tax Office.
