Traffic light confirms the end of lower VAT in gastronomy
The VAT rate for meals in restaurants will rise again from the current seven percent to 19 percent at the beginning of 2024. The chief budgets of the traffic light coalition of SPD, Greens and FDP confirmed that the temporary reduction in VAT would expire at the end of 2023 as planned.
FDP politician Otto Fricke said that there had been no agreement in the coalition on counter-financing the tax losses in the event of an extension of the tax reduction.
During the coronavirus pandemic, VAT on food in restaurants was reduced from 19% to 7% in order to support the industry. Due to the energy crisis, the regulation was extended until the end of 2023. In September, the Ministry of Finance estimated the volume of the VAT reduction at 3.4 billion euros.
The traffic light coalition decided to let the reduced VAT for meals in restaurants end at the end of 2023, as confirmed by the chief budgets. This means that the runs of lower VAT prices for gastronomy will come to an end. Businesses in the gastronomy sector will have to incorporate the value added tax increase of 12% in their prices, starting from 2024.
Source: www.ntv.de
