Facts
The spouses [A.X.] and [B.X.] born [Y.] , the complainants, have a nine percent participation in [C. AG] . They applied for the analogous application of the partial tax rate procedure to the income from their participation, which was rejected by the Tax Commission Aarau, the Tax Appeals Court of the Canton of Aargau and the Administrative Court of the Canton of Aargau.
The complainants lodged a complaint with the FSCA and requested the annulment of the decision of the Administrative Court of the Canton of Aargau and the application of the partial tax rate procedure to the income from their participation.
Considerations
The FSCA examined the jurisdiction and the prerequisites for consideration and came to the conclusion that the complaint in public law matters is admissible. The complainants complained of violations of equal treatment, uniform taxation and the prohibition of regression.
The FSCA stated that the tax harmonization law gives the cantons the possibility to mitigate the economic double taxation of corporations and shareholders by capturing the participation income at the level of the shareholders to a reduced extent. The Canton of Aargau has opted for the partial tax rate procedure, which provides for taxation of 40 percent of the rate of the total taxable income if the taxpayer is involved with at least 10 percent in the share, foundation or capital…