Maybe I am missing the point, but what is the alternative? You found a company in Germany, dont realize your gains, therefore dont pay taxes, then leave the country, realize your gains, and still dont pay taxes? Why should Germany or any other country allow this?
The issue is liquidity. The tax comes due as soon as you leave, but you might not be able to liquidate your shares quickly enough to be able to pay those taxes. Depending on how your company gets valued these can be eye-watering numbers.
This is something you can solve with enough time, but if I get a job offer where I'm supposed to start in 2 months? Very inconvenient. (There are some ways to spread this out have this tax burden spread out over time, but it still represents significant friction)
You own a company so valuable that the tax on selling it shares puts you in serious trouble, but you still need to a start "a job"? A Job that requires you to change your nationality/tax residency to a non EU-state?
Edit: Maybe I should give an example: Lets say you build up a company, your shares are worth ~100k, while you payed yourself a living salary of ~2k so you could pay rent and buy groceries but not much more, especially no savings. Now you get on offer to work in the US for 180k/a, you sigh "finally" and just want to move, but the German wants 30k Taxes on your unrealized ~100k capital gain before your leave - Is this the kind of situation you are referring to?
Pretty much. I just have a symbolic 5% stake in the company and working there has certainly not made me rich. I'm still early in my career so I don't have a ton of savings. It wouldn't cause "serious trouble" but paying tens of thousands in taxes on top of the cost and hassle involved in moving overseas is still a significant burden and certainly a case of the regulation missing its mark.
how about not taxing money you dont have?
As long as Germany and other countries allow foreign companies to do business with their subjects, then foreign companies will be at advantage to domestic companies because of the exit tax.
If they want to be strict about it, they should only allow German companies to do business with German subjects. Then there wouldn't be an advantage to foreign companies.