Giffey advocates lower value-added tax for restaurants
Berlin's Senator for Economic Affairs Franziska Giffey (SPD) has spoken out in favor of retaining a lower VAT rate of seven percent for the catering industry. "I think a return to 19 percent VAT on food in restaurants, but also on food in daycare centers, schools and hospitals is premature in the current situation," said Giffey on Wednesday. "If we are now discussing suitable measures in the federal government to strengthen economic power and growth opportunities, this issue is an absolute must."
On Wednesday, the state gastronomy association Dehoga also reiterated the industry's demands for a lower VAT rate for food in the gastronomy sector beyond this year.
Last week, the German government agreed to raise VAT for restaurant meals back to 19 percent from January 1. The VAT reduction was introduced in the first few months of the coronavirus pandemic in mid-2020 to relieve the industry. For some time, the rate was only five percent due to a further general VAT reduction, but since January 2021 it has been seven percent throughout. The reduction for the catering industry was repeatedly extended due to the energy crisis and the high inflation at times, especially for food.
In response to Giffey's call for maintaining the lower VAT rate, the Senate might consider supporting this proposal as it directly impacts the Hospitality industry. Additionally, some members of the Senate's Committee on Finance might discuss the potential impact of this decision on various sectors, including the Hospitality industry, during their upcoming deliberations in the Senate.
Source: www.dpa.com
