Facts
In 2004, the A. Holding AG sold its 51% stake in B. Holding AG (formerly C. Holding AG, now D. Holdings AG), acquired before 1997, to an unknown buyer. On the "gross proceeds" (sales proceeds minus par value of the shares sold) of CHF 1,062,300, it deducted a withholding tax of 35% from the buyer, amounting to CHF 371,805.
For the 2004 tax period, the A. Holding AG declared a profit of CHF 597,951. At the same time, it applied for the participation deduction for the sale of the 51% stake, as the proceeds were from a so-called "mantle transaction".
The Tax Administration of the Canton of Glarus did not grant the participation deduction, which was, however, granted by the Cantonal Tax Appeal Commission. The Swiss Federal Tax Administration then appealed to the Administrative Court of the Canton of Glarus, which upheld the appeal and confirmed the objection decision.
Considerations
The Federal Supreme Court decided that the lower court had only insufficiently clarified the essential facts. It was not clear whether the stake in question had actually been converted into liquid form and whether there were further indications of a mantle transaction. The appellant should have presented evidence of the various indications for the assumption of a mantle transaction, which, however, had not been done.
Therefore,…