Germany Publishes Tax Amendment Act 2025 Including Permanent 7% VAT Rate for Restaurants and Increased Support for Charitable Activities

• Effective January 1, 2026, Germany has permanently reduced the VAT rate on restaurant and catering services (excluding beverages) to 7%.
• The Act increases the commercial activity exemption threshold for non-profits to EUR 50,000 and raises trainer and volunteer allowances to EUR 3,300 and EUR 960, respectively, also from January 1, 2026.
• Deduction limits for charitable donations have been doubled to EUR 3,300 for single filers and EUR 6,600 for joint filers, coming into effect on January 1, 2026.

Source Orbitax

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Germany Cuts Restaurant Food VAT to 7% from 2026, Unifying Dine-In, Takeaway, and Delivery Rates

• From January 1, 2026, Germany will reduce VAT on all food served in restaurants to 7%, down from 19%.
• The new 7% VAT rate will apply uniformly to dine-in, takeaway, and delivery food.
• Restaurants can choose to lower prices for customers or keep prices the same and increase their profit margin.
• Beverage VAT remains at 19%, except for milk-based drinks with over 75% milk, which drop to 7%.
• Checkout processes will be simplified, as only one VAT rate will apply to all food items.

Source: fiscal-requirements.com

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