Reduced tax rate for the hospitality industry is on the brink

During deliberations in the Bundestag, the governing coalition rejected a motion to extend the reduced VAT rate for food in restaurants until the end of 2024.

As things stand at present, the reduced tax rate for food in restaurants will remain in place until December 31, 2023. However, during a debate in the Bundestag's Finance Committee, the governing coalition rejected the continuation of the regulation beyond the end of the year for the time being. The coalition cited the consequences for the federal budget and the tight budget situation as the main reasons for this. A continuation of the tax reduction would burden the federal budget with 3.3 billion euros. At the same time, the situation in the catering industry has improved significantly, as a recent survey by the industry association Degoha shows. However, the last word has not yet been spoken on this matter, as a continuation of the regulation would only be discussed during the budget deliberations anyway.