Facts
[A. AG] (hereinafter: the Taxable Entity) is a stock exchange and investment bank that mediated securities transactions between [B.A.] International and [C.A.] Inc. on the one hand, and Swiss pension funds and insurance companies (Customer Group 1) as well as Swiss asset managers and foreign collective investments (Customer Group 2) on the other hand, between January 1, 2007 and September 30, 2012. The Federal Tax Administration (FTA) conducted an audit at the Taxable Entity and concluded that turnover taxes amounting to a total of CHF 8'036'792.02 were owed for the mediated transactions. The Taxable Entity paid this amount under reservation.
The Federal Administrative Court partially upheld the appeal of the Taxable Entity and referred the case back to the FTA for further clarification of the facts and re-determination of the consequences of the turnover tax for a part of the transactions of Customer Group 2. In all other respects, it dismissed the appeal.
Considerations
The Federal Supreme Court confirmed the judgment of the Federal Administrative Court. It stated that for the exemption from turnover tax under Art. 17 para. 2 lit. a of the Federal Stamp Duty Act (StG), proof of the securities dealer status of the contracting parties at the time of the conclusion of the transaction must be available. Since the Taxable Entity was unable to provide securities dealer cards of the contracting parties for a part of the transactions of Customer Group 1, it owes a half turnover tax for those.
For the transactions of…