Kretschmann thinks higher restaurant VAT is right
Minister President Winfried Kretschmann believes that the phasing out of the lower VAT rate in the catering sector is the right thing to do. "In principle, I think it's right to bring crisis relief back to the pre-crisis level after the crisis, because otherwise the instrument can no longer be used in the future," said the Green politician in Stuttgart on Tuesday.
During the pandemic, the tax rate on food in restaurants was reduced from 19 to 7 percent. This measure to support restaurants was temporary. The planned return to the usual tax rate was postponed several times. The traffic light coalition is now insisting that the tax rate will return to 19 percent at the beginning of 2024.
However, if the federal government had decided on an extension, Baden-Württemberg would not have opposed this, said Kretschmann. "Gastronomy is a central pillar of tourism in Baden-Württemberg and is of great importance, especially in rural areas." A continuation of the lower VAT rate would have meant considerable tax losses for the state, said Kretschmann. The state would have had to reckon with losses of around 150 million euros and the municipalities with losses of around 50 million euros.
Monetary support for the hospitality industry in the form of reduced taxes on food in restaurants was instrumental during the pandemic. Despite this, Minister President Kretschmann acknowledges that a return to the 19% VAT rate for the hospitality sector is necessary, as continued support would result in significant tax losses for the state and municipalities.
Source: www.dpa.com
