Federal Constitutional Court confirms minimum profit taxation for corporations – even in cases with definitive effect

In a ruling dated July 23, 2025, the Federal Constitutional Court decided that the so-called minimum profit taxation for corporate and trade tax is constitutional. This provision means that loss carryforwards are only possible to a limited extent. Somewhat surprisingly, the court also confirmed this in cases where a company is dissolved and the losses are thereby lost (so-called definitive effect). Raphael Baumgartner and Michael Forchhammer summarize in their article why the court ruled this way and what practitioners now need to adjust to.