Germany Reintroduces 7% VAT for Food Services: Key Rules for Packages and All-Inclusive Offers

• From 1 January 2026, Germany will permanently apply a reduced 7% VAT rate to restaurant and catering services involving food, but beverages remain taxed at 19%.
• The reduced VAT rate applies regardless of whether food is consumed on-site, catered, or part of a package.
• New administrative guidance introduces allocation rules for package prices, buffets, and all-inclusive offers to simplify VAT application and reduce audit risks.
• A new optional 30% allocation rule allows businesses to allocate 30% of a package price to beverages (taxed at 19%) and 70% to food (taxed at 7%) for audit security.
• An additional 15% allocation rule applies to composite supplies with mixed VAT rates when precise allocation is not feasible, and is not limited to gastronomy.

Source: vat4u.com

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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