Why are German local authorities taxing DoD employees, despite the protests of the US and of the German federal government?
There's a pretty long military.com (Stars and Stripes) article on the matter of taxes on some DoD employees in Germany:
The U.S. contends the situation amounts to a treaty violation, but so far American officials have been powerless to stop it. It’s been happening for years, even while U.S. taxpayer dollars inject billions annually into the German economy through the military community’s spending.
But despite U.S. objections, and even indications from Foreign Minster Heiko Maas and other senior German officials that they want the matter resolved, the situation is at a standstill.
It’s unclear what authority the federal German government has over localities or how it could force tax officials at the state level to back off. [...]
In Germany, unlike any other allied country where U.S. forces are based around the world, troops and civilian personnel are exposed to liabilities if local tax offices decide that a military member has motives for being in the country beyond just their job.
Last year, there were nearly 400 cases involved SOFA status personnel in the greater Kaiserslautern area alone, tax officials said at the time. They included Air Force Master Sgt. Matthew Larsen, who was targeted for extending a tour and being married to a German woman.
Being a teacher at a U.S. base school for long periods of time or sending kids to a German school also have put people on the tax collector’s radar.
In the United Kingdom, Italy, Japan and South Korea, all countries that host large numbers of service members, DOD personnel routinely marry locals or have extended tours without threat of income taxation, according to commands that oversee SOFA matters in those countries.
So why are the local/land tax authorities going after the US DoD personnel on this issue, when it is clearly annoying the federal government of Germany? Why is there a political divergence between the local/land and federal government on matter and why is it manifesting now?
Note: DoD means department of defense, and SOFA means Status of Forces Agreement.