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Abstract
The purpose of this paper is to assess the selected tax expenditures in German personal income tax aimed
to support farmers. German system of tax preferences is undoubtedly one of the most interesting examples
of agricultural tax expenditures in the member states of the European Union. The paper is also an attempt
to answer the question, whether method applied to estimate agricultural production income in the German
personal income tax, in fact, lowers the tax burden of farms owners and, secondly, what are the consequences
of this instrument for agriculture sector? The conducted study confirmed that the introduction of this tax
expenditure has resulted in a simplification of the tax accountancy obligations of farmers. However, at the
same time due to the reduction of the fiscal burden, there is significant inhibition of transformation of the
area structure of farms in Germany.