Households in Germany don’t have to pay the full VAT of 19 percent again on March 1st. A corresponding passage in the envisaged Growth Opportunities Act was deleted.
The VAT cut for gas is not due to expire until the end of March – a month later than planned. This emerges from the result of the mediation committee of the Federal Council and the Federal Council on the Growth Opportunities Act. According to the version adopted by the federal law, there was still talk of the reduction expiring at the end of February.
Because of the increased energy prices after the Russian attack on Ukraine, the federal government reduced the VAT rate for gas and heat from 19 to 7 percent, making both cheaper. According to current law, the measure is set to expire at the end of March.
A spokesman for the SPD parliamentary group said that with the Growth Opportunities Act, the reduced tax rate for the supply of gas and heat should expire on February 29th. “This measure has been deleted. This means that the reduced tax rate does not expire until the end of March.”
The municipal utilities association VKU welcomed the decision of the mediation committee. Managing director Ingbert Liebing said: “That’s right and a good thing. Clarity was needed, the long deadlock has been resolved. An early tax increase would have made gas and electricity more expensive for everyone earlier. This would have been in complete contradiction to the debated aid for the economy .”
The amended Growth Opportunities Act still has to pass the Bundestag and Bundesrat. It is unclear whether the Union agrees to the law. According to the current sales tax law, the VAT reduction expires at the end of March anyway.
Source: Stern
