Stuttgart's administrative court rejected the appeal against the special sexual services tax launched by the owner of a tantric massage parlour.
In what a court spokeswoman said was the first case of its kind, the judge ruled that because tantric massage can also, "according to the situation, include sexual pleasure," it should be taxed like a brothel or sex club.
The 55-year-old owner of the massage parlour had appealed against the imposition of €840 in sex services tax over two months.
Her argument that the full-body massage always followed tantric rituals and was not primarily for sexual pleasure was not enough for the judge, who said that because customers could pay for massage of their genital area, it was a sex business.
The court heard that tantra massage involves both parties being naked, and that the genital areas of the customer were included in the full-body nature of the massage.
Stuttgart is one of many Germany cities to levy a special sex services tax, and last year raised around €1 million in funds that way.