"Non-Germans" Under the Third Reich (40 page)

2. The Treatment of Polish Property in the Altreich

In the treatment of other non-Aryan property, the goal was the same as for that of the Jews. The job was easier and quicker in the case of these “aliens” from the occupied Polish territories, however, because here no questions of citizenship needed to be taken into consideration. The basis was the Decree on the Property of Persons of the Former Polish State, dated October 17, 1940,
⁶⁶
which provided for the seizure of the property of all Jews who had their residence in the Annexed Eastern Territories in 1939. The same also applied to the property of such persons who resided in the Altreich territory.
⁶⁷
Beginning in 1941, the Reich Ministry of Finance regarded this property as belonging to the Reich in principle,
⁶⁸
so that Jewish proprietors had no legal rights whatsoever. The same decree also served as the basis for the confiscation of the property of Poles living in the Altreich who had fled from the Annexed Eastern Territories. Polish property in the Altreich was subject to the Decree on the Treatment of Enemy Property of January 15, 1940,
⁶⁹
and the Decree on Guardianship for Absentees of October 11, 1939.
⁷⁰

EXCURSUS

Tax Law

The economic dispossession of Jews and other non-Aryans was further pursued and accelerated by discriminatory regulations in the field of tax law.
¹
The goal of the fiscal policy was to squeeze as much tax revenue from the Jewish population as possible with a view to speeding up their economic ruin. At the theoretical level, the implementation of this goal met certain difficulties early on, however, because fiscal law had adhered closely to the principle of equality in taxation. There were no such difficulties in practice, however. The principle of equal taxation was in any case applied by the boards of assessment only with the aim of wringing as much as possible from taxpayers,
²
and in the taxation of “aliens” and all other people or associations that did not conform racially or politically (e.g., the freemasons),
³
it served only to make the fiscal rules harsher, even in contempt of the law as it stood.
⁴
But as soon as the question arose whether Jews should enjoy the same benefits or privileges as Germans or whether it would not be a good idea to enact special laws, the principle of equality in taxation was quickly forgotten. The relation in fiscal law between the state and the citizen was defined as a “relation of loyalty in public law” (
öffentlich-rechtliches Treueverhältnis
) for all “compatriots” (
Volksgenossen
),
⁵
in which the boards of assessment had the “power of command” over taxpayers.
⁶
Since Jewish citizens belonged neither to the German nationhood nor to the German
Volksgenossen
(i.e., were not a part of the German “community of law”), it was argued, they could not enjoy the principle of equality in taxation.

In regard to the first aspect, the discrimination of “aliens” in contempt of the existing law, many courts, and especially the Reich Finance Court, played an important and destructive role. A good example is the judicature of this court in the field of the so-called Reich Abandonment Tax. This tax, which had been created during the Weimar Republic,
⁷
was intended to provide a certain compensation to the state for the loss of taxes as a result of emigrations.
⁸
After 1933 it was, of course, applied to Jews, who were more or less forced to emigrate. In 1937 alone, over RM 80 million flowed to the Reich.
⁹
According to section 2, paragraph 3, of the relevant decree (issued December 8, 1931), the Reich Abandonment Tax was not exigible if the board of assessment decided that the abandonment of residence was “in the German interest” or economically justified. This rule was now turned on its head. The emigration of Jews had been always been justified in public discussions by its great interest for the state. When Jews desiring to emigrate claimed exemption from this tax in view of the prevailing anti-Semitism, however, the Reich Finance Court quite laughably declared that the enforcement of regulations did not take racial descent into consideration. It was not a matter of German interest in the emigration: what was relevant was whether the emigrant would promote German interests abroad, something that was quite out of the question in the case of Jews.
¹⁰
Under the terms of the law, furthermore, the Reich Abandonment Tax was not due if the emigrant remained abroad involuntarily. The Reich Finance Court, however, dismissed the argument by Jews that their emigration was involuntary: the fear of discrimination, the court argued, was not an immediate compulsion in the sense of precluding free will.
¹¹
The same interpretation held, the court ruled, in the case of emigration resulting from the seizure of property or severe maltreatment (e.g., by the Gestapo).
¹²

Regarding tax discrimination against Jewish associations, the Reich Finance Court passed a ruling in 1938, for example, concerning the validity of an anti-Jewish tax law. The law, issued on March 28, 1938,
¹³
withdrew the status of public-law corporation from the Jewish cultural organizations with respect to certain tax privileges they had enjoyed in common with other German associations. The court ruled not only that this law was valid but also that it was only of a declaratory nature: even without such rules, taxation had to follow this line.
¹⁴
Indeed the Reich Finance Court had acted in this sense even before this law became effective, by refusing (
contra legem
) the status of nonprofit organization to Jewish cultural welfare associations and in so doing refusing them reduced taxes and fees as provided for by the Property Tax Law. Other courts had, however, applied the tax privileges correctly to Jewish associations on the basis of the existing law, at least until 1938.
¹⁵

This practice of the Reich Finance Court was also applied to high schools, for example, on the strength of the argument that “the promotion of high school education for nationals of foreign race” was not in the interest of the German
Volksgemeinschaft
.
¹⁶
Jewish athletic clubs, hospitals, scientific associations, and so on, were also drawn into the net.
¹⁷
In 1937 an administrative order of the Reich ministerial authorities, adhered to by the Reich Finance Court,
contra legem
, withdraw all exemptions from administrative fees and court fees that had been enjoyed by Jewish charitable foundations, on the argument that charitable purposes (under the terms of the law) were only such purposes that “exclusively and directly” served needy German
Volksgenossen
.
¹⁸

The Jewish missions run by the churches, which had hitherto enjoyed tax privileges as a valuable ecclesiastical activity (according to sec. 19 of the Tax Adjustment Law) lost their privileged status. The Reich Finance Court declared—consistently in “racial” terms—that Jewish missions were neither nonprofit nor charitable, since the “German people” saw “no benefit to their well-being”
¹⁹
in the conversion of Jews. Charity benefits accorded to Jews who under the terms of the law could formally be recognized as “worthy of support,” that is, entitled to tax privileges (Tax Adaptation Law, 1934, sec. 18), were deprived of this “worthiness” by an amendment to the law. Here too the argument was a racial one: “charity” in the context of fiscal law meant only charity toward the German
Volksgenossen
(introductory law to the Real Tax Law [especially land tax]).
²⁰
After 1938 even Jewish cemeteries were made subject to property tax, although cemeteries in general were exempt from taxation. Religious reasons, the Finance Court argued, were only “a personal circumstance,” which did not exclude fiscal obligations.
²¹

The courts ruled in a very restricted way where the possibility of tax reductions was concerned. As early as 1933, the Reich Finance Court had ruled that under the terms of the income tax laws,
²²
Jews were not entitled to the usual deduction of professional expenses and special allowances. Other tax deductions, such as the reduced tax rate under section 34, paragraph 2, subparagraph 4, of the Income Tax Law were also denied to Jews, on the grounds that allowing the deductions would go against the “sound ethnic philosophy” of the German people.
²³
The Jewish proprietor of a department store claiming special depreciation due to the increased trade risk resulting from his racial descent was only partially satisfied: the court decided that prejudices caused by the boycott of Jewish shops were not among the “objective conditions of the firm” (the basis of tax reductions) but were only a “personal” factor and therefore could not be taken into account.
²⁴
The Reich Finance Court also denied Jews the higher tax-free allowance on property owned, which was normally granted when there was an incapacity to earn a living. The court did not consider the fact that unemployed Jews could not find work anywhere but ruled that the Jewish plaintiffs, though unemployed, were not unfit for work
²⁵
(and therefore not entitled to tax reductions). However, the Supreme Finance Court granted people who had acquired Jewish property following the pogroms of November 1938 a general 50 percent reduction in the evaluation and thus a 50 percent tax reduction, because with “the retaliation measures of the German people … of November 1938 all supplies [had] diminished considerably in value and a statement of losses was not possible in the individual case.”
²⁶
By the same argument, the cheap acquisition of Jewish property in the cause of Aryanization (on the grounds of the Decree on the Utilization of Jewish Property of December 3, 1938) was met with a special “Aryanization tax” (sec. 15, par. 1, of the decree). The Reich Finance Court advanced the argument that an estate in Jewish hands would have a lower value than one in German hands but that the purchaser might not take advantage of this.
²⁷

In order to put the discrimination measures on a broader, more general level, explicit special regulations for non-Aryans were introduced by law or administrative rules at the beginning of the economic deprivation. These were summed up in an administrative order by the Reich minister of finance dated February 10, 1940,
²⁸
on the special treatment of Jews in fiscal law. The following matters were dealt with: by a law of February 1, 1938,
²⁹
the (usual) tax reductions granted to those bearing extraordinary child-care expenses (e.g., those who had children with disabilities) were denied to Jews if the children were considered Jewish by law.
³⁰
From mid-1938 on, Jewish schools were refused all exemptions from taxation by administrative order of the Reich Ministry of Finance.
³¹
Emigrating Jews taking goods with them had to pay a tax to the gold discount bank that generally amounted to 100 percent of the value of the goods in question.
³²
Jewish landowners were denied the usual possibilities of claiming exemption from land tax.
³³
Jewish cultural organizations, as we have seen, lost their status as public-law corporations (and with that their tax privileges) by a law of March 28, 1938.
³⁴
By the decree of September 20, 1941,
³⁵
issued by the Reich minister of finance, a “social compensation tax” was imposed on all Poles (except for those capable of “Germanization” or living in an “ethnic mixed marriage”) and Jews in the Reich territory. This tax consisted of a 50 percent increase in income tax, in no case deductible (for example as an extraordinary burden under the terms of the income tax law).

VIII. Discrimination against “Non-Germans” in Public Life

Side by side with the economic robbery and ostracization in the cultural and professional domains, a huge propaganda campaign was waged with the aim of distinguishing Jews from
Volksgenossen
by external signs in order to isolate them from their surroundings and put them at the mercy of public contempt and the arbitrariness of state bodies and Party agencies, with a view to establishing the conditions for a Final Solution to the “Jewish question.” As in the campaign to create economic impoverishment, the Jewish businesses were the first to be attacked, and this concept was based not on legal criteria but on actual features (“the dominating influence of the Jews”).
¹
These businesses had to be registered on the basis of the Third Decree to the Reich Citizenship Law of June 14, 1938,
²
and the Reich minister of economics, in agreement with the Reich minister of the interior and the deputy of the Führer, was empowered to order them to bear a distinguishing mark. At the same time a policy was instituted to mark individual Jewish citizens, after the efforts of previous years to openly declare Jews unwelcome in public offices had been prohibited by the Reich minister of the interior.
³
This campaign was carried out in the usual manner of first practicing discrimination against Jews in their relations with the authorities and subsequently carrying out the practice toward the general public.