As a new evaluation shows, the accounts of German real estate investors often end up in tax havens. This is due to the fact that in Germany you can pay for entire houses in cash, critics say. But the lack of digital networking in Germany is also a problem.
According to a report, many property owners in Germany remain anonymous thanks to investing through companies. As a new evaluation of the “Welt am Sonntag” now shows, the owners of every fifth company entry in the cadastral registers of the federal states cannot be determined personally. The land register entries often lead via other owners to companies that are based abroad.
The “Welt am Sonntag” requested directory data from all federal states for its evaluation. Five of them replied:
Other federal states would have referred to problems with data protection – or too much effort in data collection.
The evaluation only took into account the data from companies, not from private individuals. She came to the conclusion that the owner chains regularly end up in tax havens such as Cyprus, Switzerland or the Cayman Islands. In Dresden, Erfurt and Essen, this applied to about half of the companies based abroad. In Hanover, Thuringia and Saarland at least around 40 percent, the newspaper reported.
There has long been criticism of the opaqueness of property ownership in Germany. Unlike in many other countries, it is possible in this country to pay for expensive real estate with cash, which makes money laundering easier.
The traffic light government agreed in the coalition agreement to abolish this payment option. In addition, the coalition wants to “link the database land register with the transparency register in order to end the concealment of the true owners of real estate”. The debate about anonymity in the real estate market recently gained momentum in connection with the sanctions against the Russian elite over the Ukraine war.
“A lot of illegitimate capital flows through tax havens, for example from criminal acts, raw material speculation by corrupt states or bribes,” said the economist Jakob Miethe from the Ludwig Maximilian University in Munich, who was involved in the data analysis. Profits from regular rental income could also be concealed and tax-optimized via anonymous owner chains.
