Facts
The Federal Tax Administration and the Cantonal Tax Office of Zurich have filed a complaint against the decision of the Federal Tax Appeals Commission of the Canton of Zurich. The latter had decided that the nominal value gain, which [R.A.] had achieved from the quasi-merger and subsequent absorption of [X. AG] and [Z. AG] , was not taxable.
[R.A.] was a shareholder of [X. AG] and [Z. AG] . In 1992, the shareholders undertook to transfer their shares to [Y. AG] . In return, they received shares of [V. AG] , which was formed by the merger of three subsidiaries of [Y. AG] . In 1993, [V. AG] absorbed [X. AG] and [Z. AG] .
The Federal Tax Administration and the Cantonal Tax Office of Zurich are of the opinion that the nominal value gain is taxable, as it qualifies as a capital gain within the meaning of Art. 21 para. 1 lit. c DFTA.
Considerations
The Federal Court has evaluated the case as follows
The quasi-merger and the subsequent absorption are two separate transactions that, however, are to be considered as a single economic transaction. The nominal value gain resulting from the quasi-merger is taxable, as it qualifies as a capital gain within the meaning of Art. 21 para. 1 lit. c DFTA.
The Federal Court has found that the quasi-merger and the absorption were part of a comprehensive and long-term balancing of interests between the shareholders and the acquiring company. The detour via the…