Buying land and paying part in cash normal?

Regarding my personal stance: 1) In 2016, we sold building land.. We were also offered the option because of saving real estate transfer tax. We declined, referring to profession/position/law. This was accepted. By the way: The appraisal committee set a value for our land that was 22 euros per sqm lower than its market value. 2) Yes, I am of the opinion that a society free from fraud, legal violations, etc. is not achievable without excessively interfering in our lives. (See China, where public shaming is now being attempted.) I do not want to live in such a society. 3) I believe the best protection against legal violations is when what is lawful and what we perceive as just are closely aligned. 4) According to my sense of justice, real estate transfer tax is not just—at least not in transactions between private individuals—and I also consider higher taxation of real estate transactions (namely at the normal income tax rate) compared to capital gains on shares to be unfair. 5) Moreover, I find our entire tax system complicated, cumbersome, and the progression far too steep. If a government seriously considers offering public transport free of charge, then it simply has too much money that it has taken from us beforehand. Karsten

The question is what the state can practically do about it. Personally, I also find the real estate transfer tax really inappropriate and very difficult to justify with normal considerations.

You mean the discrepancy to the normal VAT rate of 19% on almost all other goods and services?

The 19% argument does not convince me. Whoever buys a ship for 500 thousand pays 19% on it. That amounts to almost 600 gross. If he sells it within the EU for 500 after a few years, no VAT is due. Once, not anymore. On land: every time the tax authorities take their share.

Either you do it like with others: net price + VAT at purchase.

Or: tax-free purchase, but profits taxed at the flat tax rate upon sale.

Why there is a flat tax rate for certain types of profits instead of taxing everything as income is also a lobbying success.

Only: if that were the case, would there be less cheating?

In my sense of justice, the real estate transfer tax is not fair,

Which tax feels fair then?

I think the best protection against breaking the law is when what is legal and what we perceive as just are closely aligned.

The law is precisely meant for the many contrary situations. Going out after the tavern with pitchforks to hang a few alleged child molesters would be considered very just by many—and is nevertheless forbidden for very good reasons. Preventing lawbreaking by legalizing it is therefore not always a good idea. Civilizational achievements like the Basic Law are not intuitively rooted in humans, otherwise we wouldn’t have had to invent them. For example, slavery was intuitive, as thousands of years of history show. Humans are therefore not well advised to constantly orient themselves by their feelings. These are partly archaic. That is why using a sense of justice as a standard for law is not a good idea—even if, without an indirect connection between the two, society cannot function, so I agree with you in that respect.

I believe we won't agree on that. However, that goes beyond the scope of a construction owner's forum.

The aim of the withholding tax was to bring back capital gains from abroad and to simplify the issue of double taxation (first at the corporate level, then after distribution to the owner). Whether this has been achieved overall is another matter. The coalition agreement of the best grand coalition of all time envisages returning to the personal tax rate for interest income. With dividends, it is more complicated because they have already been taxed at the corporate level. Not so simple...

And yes, the real estate transfer tax is unfair. There is a lack of an exemption or a "free shot" for the first acquisition. We paid > 20,000 euros in real estate transfer tax (purchase from the developer). When companies/investors transfer real estate, they usually do not pay real estate transfer tax because they prefer to sell companies instead of the properties. This option is not available to private individuals.