“Membership” supermarket discount model is subject to VAT at the standard rate

The Bundesfinanzhof (BFH) has decided that granting a license to purchase goods at a reduced price (in the form of a “membership”) represents an independent service in terms of VAT and not just an ancillary service for the later sale of goods. Even if the supermarket sells goods that are subject to both the standard tax rate (19%) and the reduced tax rate (7%), the standard tax rate must be applied to the membership fee.


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