German Gov: DPWN Tax Exemption OK
German government sources said on Monday that an exemption from sales tax for certain services provided by German postal and logistics group Deutsche Post AG was justified. Berliner Zeitung newspaper reported that Deutsche Post must pay back hundreds of millions of euros in taxes to the state of North Rhine-Westphalia, where it is based, because it had pocketed income from a tax exemption that was invalid. But government sources said they had informed the state that the tax exemption on letters and small packages should stand. Investors have been fearful in recent weeks that Deutsche Post might be forced to make big paybacks amid allegations that it has charged clients too much tax. ‘It’s absolute nonsense to say that Deutsche Post took in sales tax that it shouldn’t have…it’s definitively wrong,’ said Deutsche Post spokesman Martin Dopychai. ‘Naturally any sales tax that we collect, we send the exact right amount to the Finance Ministry,’ said Dopychai, adding that the Finance Ministry ‘gets its dues’. Deutsche Post shares jumped on the news, rising 1.3 percent to 14.60 euros by 1322 GMT and reversing earlier losses, while the overall DAX index of German blue-chips rose 0.85 percent.
