Short sentence

DW: What is your view of the sentence?

Jochen Bachmann: Looking at the amount of tax evaded, three and a half years is amazingly short. The court must have understood that Mr. Hoeness wanted to submit a complete voluntary disclosure but was unsuccessful. And that when people make an effort to come clean then they deserve some leniency. If the sentence was what the prosecutors thought was reasonable then it would have been a recognition that in such situations it's a mistake to file amended returns and come clean.

Does the Hoeness verdict represent the beginning of a new era when it comes to prosecuting tax evasion?

No. This case deals with a voluntary disclosure that was made, apparently with the intention of admitting everything. The disclosure does not appear to have been made in full. Still, it was conceded to Mr. Hoeness that "yes, you wanted to come back to the path of virtue, and we will give you a lot of credit for that." The intended signal is then that it is still better to come clean and file the voluntary disclosure than to fight everything and do nothing. Generally, criminals receive some credit for admitting guilt when they choose to do it themselves.

Is it always so difficult to file a voluntary disclosure?

For the last few years we have had very tight voluntary disclosure laws. Filing a disclosure is only valid when it is absolutely, 100 percent correct - that has not always been the case. Today an incomplete voluntary disclosure does not lead to exemption from legal punishment. That has meant that voluntary disclosures have to be made much more carefully and need more time in order to be made. That is particularly the case when a capital asset is concerned where there were a lot of transactions and each transaction needs to be calculated individually. There's actually no good way to estimate it.

It sounds like the entire procedure has been made very complicated...

Yes. Voluntary disclosures today are very different from what we used to have. You used to be able to put a voluntary disclosure on a single page without too much difficulty. If 5 percent were missing than you negotiated with tax officials over the missing 5 percent and everything was settled. If 5 percent is missing today the voluntary disclosure is worthless. That's the problem. On top of that, tax laws have become more complicated. The composition of the taxable base is more difficult. And finally, the person who wants to disclose something takes a risk in choosing the right consultant. I'm not so sure that all of this is really in line with the spirit of the law.

Is it any use for Hoeness to appeal?

An appeal can only challenge legal errors. These are either procedural errors, which I cannot evaluate, or material errors, the question of whether the law was properly applied. That would apply to the question of whether the voluntary disclosure does in fact apply. The sentence, from the defense's point of view, cannot be the main goal of an appeal. Mr. Hoeness has to be happy with that.

In the end, it can only address the validity of the voluntary disclosure. That can only be verified by the Federal Administrative Court. If I were a lawyer for the defense, I'd be wary of such a step. At the moment, the court is not particularly good when it comes to tax evaders. It always says, "bad cases make bad law," which means that if the court decides that the voluntary disclosure was invalid, it could make the hurdles for such a disclosure even higher.

Jochen Bachmann is a tax attorney and works in Bremen.