Facts
Spouses A.A. and B.A. have their tax domicile in U./SO. The husband has been self-employed (scrap iron and metals) since 2004. In the tax periods 2006 to 2009, the spouses did not submit annual financial statements despite reminders, which is why the Cantonal Tax Office Solothurn (KStA/SO) proceeded to assess the income from self-employment based on its discretion. It assessed the estimated income from self-employment on a discretionary basis.
On February 20, 2012, the KStA/SO opened a supplementary tax and tax evasion procedure, as it suspected that the four assessments had been too low. The taxpayers then disclosed previously undeclared accounts and deposits worth around CHF 1,000,000. By decisions dated August 6, 2014, the KStA/SO concluded the proceedings and now assumed significantly higher income from self-employment.
The taxpayers filed an objection against these decisions. The Tax Court of the Canton of Solothurn partially upheld the legal remedies, reducing the penalty coefficient to 0.7.
By appeal to the Federal Supreme Court, the taxpayers requested that the income from self-employment be set lower, that provisions be made, and that the supplementary taxes and default interest be deducted. They also demanded acquittal of the charge of tax evasion or at least a lower fine.
Considerations
The Federal Supreme Court examines federal law ex officio and with unrestricted cognition. It notes that the tax assessment authority has properly applied the usual mixed method (asset development and living expenses). The taxpayers were unable to demonstrate in what respect the assessment should be obviously incorrect.
However, the assessment authority wrongly did not make any…