Facts
The tax administration of the Canton of Bern had originally exempted Foundation [X.] from tax liability, but later revoked this exemption. The Administrative Court of the Canton of Bern overturned the decision of the Tax Appeals Commission and exempted the foundation from tax liability as of December 31, 2009, with regard to cantonal and communal taxes as well as direct federal tax. The tax administration of the Canton of Bern appealed to the Federal Supreme Court.
Foundation [X.] operates a meditation center, where it conducts meditation courses for a fee. The course prices cover the costs of accommodation and food for the course participants, the expenses of the instructors, and the expenditures for administration, advertising, and operation of the center. The instructors do not receive compensation, but only reimbursement of expenses and anonymous donations from the participants.
Considerations
The Federal Supreme Court examined whether Foundation [X.] meets the requirements for tax exemption due to public benefit. It found that the foundation fulfills the general requirements for tax exemption, namely the exclusivity of the use of funds, the irrevocability of the purpose, and the actual activity of the foundation in accordance with its statutory purpose.
The court found that the foundation acts altruistically, as it does not pursue profit-making or self-help purposes. The fact that the foundation charges course fees to cover the costs of accommodation and food for the course participants does not change the altruistic nature of the foundation. The court concluded that…