The Financial Times Deutschland (FTD) reported on Thursday that two research centres of the Helmholtz association could face three-figure million tax bills.
The German national research centre for aeronautics and space (DLR) in Cologne could have to repay up to €300 million – from an annual budget of €574 million, the paper said.
Should this happen, it could be taken as a precedent and lead to other centres also paying huge sums in tax. This would put a big dent in Germany’s investment in scientific education and research.
“Such a development would lead to a clear weakening of Germany as a base for research,” said a statement from the Economy Ministry, which is responsible for the DLR.
The Jülich Institute, which specialises in research into the environment, medicine and energy, could also face a potentially ruinous tax claim, the FTD said.
The centres have reportedly been claiming value-added tax back from the tax office as if they were companies – thus saving themselves millions when buying in services and goods.
But because the centres conduct basic scientific research and rarely develop products that reach the market, the VAT claw-back is not justified – it cannot be reclaimed for basic research.
On average, all 17 Helmholtz centres could face a bill of up to €40 million a year each – plus back-dated claims, according to the Berlin state Research Ministry.
The federal Research Ministry called for a swift resolution to the situation, although the FTD said that the Economy Ministry has already confirmed the basic argument of the accountants – the research institutes are “responsible for their own tax returns” and “should not count on being helped with additional budgetary money.”