No Hope for Extension of Reduced Gastronomy VAT: Back to 19% from 2024

• The reduced VAT rate for restaurant and catering services will not be extended beyond December 31, 2023.
• The reduced rate of 7% was introduced in July 2020 due to the COVID-19 pandemic.
• Opposition parties in the Bundestag tried to permanently extend the reduced rate, but did not have enough support.
• The Bundesrat also failed to pass resolutions calling for a permanent reduced rate.
• The government cited the cost of the reduced rate as a reason for not extending it.
• The failure to extend the reduced rate will have negative consequences for the industry.
• The reduced rate also affects other sectors such as catering companies, grocery stores, bakeries, and butchers.
• The end of the reduced rate will impact consumers and social services that provide meals.
• The decision is due to financial constraints, including a 60 billion euro shortfall in the federal budget.

Source: nwb-experten-blog.de

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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