Dispute with the Aargau tax authorities Unemployed man collects millions - and doesn't want to pay taxes
An Aargau couple is convinced that the proceeds from the sale of a license are tax-free. The authorities see it differently. Millions are at stake.
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- An Aargau couple is arguing in court about the tax treatment of CHF 5.4 million from the sale of a vaccine license.
- The High Court ruled that the amount is considered income from self-employment and is therefore taxable.
- If the ruling becomes legally binding, the municipality could receive tax revenue of up to two million francs.
A complex tax dispute is raging in the canton of Aargau involving considerable sums of money. The tax commission of an Aargau municipality has set the taxable income and assets of a married couple at around CHF 5.5 million each for 2018. This figure is in stark contrast to the couple's tax return, which shows a taxable income of just CHF 87,702, as reported by the Aargauer Zeitung newspaper.
The significant difference of 5.4 million francs arose in 2018: the husband received six million US dollars - the equivalent of around 5.4 million francs - from the sale of a license for hepatitis vaccines.
The couple also declared their taxable assets for that year at 5.5 million francs. Because the husband was unemployed in the same year, he also received CHF 4029 from unemployment insurance.
Tax-free or not?
The couple appealed against the tax assessment, which brought the case before the Supreme Court. The central question: should the 5.4 million be regarded as income from self-employment or as a private capital gain? The latter would be tax-free.
However, in the recently published ruling, the court decided in favor of the canton and the municipality. The license was to be regarded as a business asset and the man had intended to make a profit.
If the ruling becomes legally binding, it could bring the municipality a considerable tax windfall: With a low tax rate of 57 percent, more than 1.6 million francs would be due, and with a high rate of 125 percent, even more than 2 million francs.
