Swiss Federal Supreme Court, 01.10.2025, 9C_47/2025
Facts
Following the initiation of administrative criminal proceedings for VAT evasion against the director of A.________ AG, the Federal Tax Administration (FTA) conducted a tax reassessment for the 2014–2017 periods, resulting in a tax back-payment of CHF 52,449. Concurrently, the director was fined for intentional tax evasion. A.________ AG challenged this back-payment. Its objection was rejected by the FTA, and its subsequent appeal was dismissed by the Federal Administrative Court. The company then appealed to the Federal Supreme Court, challenging the validity of the tax back-payment for the 2015 and 2016 periods and raising numerous procedural complaints, as well as the statute of limitations regarding the tax claim.
Legal Analysis
The Federal Supreme Court reiterates the strict requirements for substantiating an appeal in public law matters (Art. 42(1) and (2) and Art. 106(2) of the Federal Supreme Court Act). The appellant cannot simply repeat arguments already presented to lower courts or substitute its own version of the facts for that of the lower authority. It must demonstrate, by referring to the reasoning of the contested decision, how that decision violates the law. Constitutional complaints must be substantiated in a clear and detailed manner. Regarding the statute of limitations for VAT assessments, the Federal Supreme Court clarifies that the initiation of criminal proceedings for tax evasion suspends the relative limitation period (Art. 105(3)(a) in conjunction with Art. 42(4) of the VAT Act). However, this suspension does not affect the ten-year absolute limitation period, which continues to run (Art. 42(5) of the VAT Act).
Application to the Case
The Federal Supreme Court finds that the vast majority of the complaints raised by the appellant are insufficiently substantiated. The company merely reiterates its allegations without addressing the detailed arguments of the Federal Administrative Court's ruling, particularly regarding alleged violations of the right to be heard and the principle of fair procedure. On the merits, the Federal Supreme Court upholds the analysis of the lower court. The appellant failed to prove that certain recorded transactions were merely cash transfers rather than consideration for taxable services. Likewise, it failed to prove that a payment to an individual in Russia constituted pre-financing rather than remuneration for a service subject to acquisition tax. The adjustments to input tax and turnover are therefore maintained. Finally, the Federal Supreme Court rejects the argument regarding the statute of limitations. The initiation of criminal proceedings in 2017 validly suspended the relative limitation period for the 2015 and 2016 tax periods. At the time the Federal Administrative Court issued its ruling, neither the relative limitation period (which was suspended and then interrupted) nor the ten-year absolute limitation period had expired.
Outcome
The Federal Supreme Court dismisses the appeal to the extent that it is admissible. The legal costs are to be borne by the appellant company.
Silex Tax Newsletter published in collaboration with Anna Vladau, Attorney at Law
