The German tax system operates on the federal and regional levels. The Federal Central Tax office overlooks tax payments nationwide, whereas regional offices across the country administer tax workings in different states.
Everyone living in Germany has to pay tax on their earnings regardless of citizenship status. That is, whether you are a German citizen or an ex-pat, you must file your taxes to avoid penalties and fines. Since there is no way to avoid paying taxes, there are a few ways to acquire refunds and reductions.