Werbungskosten oder Subvention? Zur Rechtfertigung der Entfernungspauschale und Perspektiven ihrer Ausgestaltung

Stefan Homburg points out that in Germany commuting expenses have been deductible from the income tax base for a long time. Germany’s grand coalition has now restricted this deduction. The article analyses whether or not this was justified from an economic point of view. It is shown that, in the long run, the tax treatment of commuting expenses has nothing to do with production efficiency. Commuting rather represents a form of household production. The overall conclusion is that the more restrictive tax treatment seems economically justifiable.Whereas Holger Karrenbrock deals with the arguments of the proponents of the so-called ‘Werkstorprinzip’, a principle which means that for tax purposes the sphere of occupational activity ends at the factory gate. He demonstrates that expenses for commuting to and from work are incomerelated and therefore have to be tax deductible. The commutation to and from work is a condition precedent to income production, and the corresponding expenses solely arise from the taxpayer’s occupation, which both is essential in his opinion.Johann Eekhoff, however, emphasizes that since 2007 costs of commuting in Germany are in principle no longer deductible from taxable income. This change in taxation is appreciated because commuting costs can be substituted by housing costs. Generally speaking, the sum of both cost factors is the same at any distances from work. Only for married couples costs of a second household near the workplace should be tax-deductible if both partners are employed at different places.