Facts
The appellant X. sold a residential house with a boathouse and 627 m2 of land in E. on July 13, 2006 for the price of CHF 3,500,000. The transaction was brokered by the attorney Y., who received a success-based commission of CHF 152,000. The Real Estate Tax Committee of the municipality of E. only allowed a deductible brokerage commission of CHF 75,320 in the calculation of the real estate capital gains tax. X. unsuccessfully appealed this decision up to the Federal Supreme Court.Considerations
The Federal Supreme Court states that according to the practice of the Canton of Zurich, only "customary brokerage commissions" of a maximum of 2% to 3% of the sales price are considered deductible "expenses" within the meaning of § 221 para. 1 lit. c of the Zurich Tax Act. The commission of CHF 152,000 (4.34% of the sales price) exceeding this rate is not fully deductible, as the "broker's" activities went beyond the classic brokerage tasks and included a 40% profit participation. Such a revenue allocation does not constitute a deductible expense for tax purposes.
The Federal Supreme Court does not see the Canton of Zurich's limitation on the deductibility of brokerage commissions as a violation of the principle of taxation…