What are the current value-added tax rates in Germany?
August 5, 2022 | 40,00 EUR | answered by Emma Wagner
Dear Tax Advisor,
my name is Lorenzo Tiefbach and I operate an online shop where I sell various products. Lately, I have noticed that the value-added tax rates in Germany may have changed and I am somewhat unsure about which rates currently apply. I am aware that there are different value-added tax rates for different products and services, but I am not sure if there have been any changes in the past few months.
I am concerned that I may be providing incorrect information and as a result, face tax problems. Therefore, it is very important for me to know which value-added tax rates currently apply in Germany. I want to make sure that I pass on the correct tax rates to my customers and avoid any tax errors.
Could you please explain to me exactly which value-added tax rates currently apply in Germany and if there have been any recent changes? Are there different rates for different products or services that I need to consider? Are there any special regulations that may be relevant to me?
Thank you in advance for your help and support. I look forward to receiving your detailed response to clarify my uncertainties regarding the value-added tax rates.
Sincerely,
Lorenzo Tiefbach
Dear Mr. Tiefbach,
Thank you for your inquiry regarding the current VAT rates in Germany. As a tax advisor specializing in VAT, I am pleased to be able to assist you with your questions.
First and foremost, I would like to emphasize that there have indeed been recent changes to the VAT rates in Germany. The last major change took place on July 1, 2020, when the VAT rates were temporarily reduced as part of the government's economic stimulus package. The standard VAT rate was reduced from 19% to 16% and the reduced VAT rate from 7% to 5%.
This temporary reduction in VAT rates was in effect until December 31, 2020. Since January 1, 2021, the standard VAT rates have returned to normal: the standard rate is 19% and the reduced rate is 7%. These are the generally applicable rates that apply to most products and services.
However, there are exceptions and special regulations where different VAT rates apply. For example, there are goods and services subject to the reduced rate of 7%, such as food, books, or certain cultural events. On the other hand, there are also products subject to the standard rate of 19%, such as electronic devices or clothing.
As an online shop owner, it is important for you to familiarize yourself with the various VAT rates and ensure that you pass on the correct rates to your customers. It is advisable to regularly review the current laws and regulations to avoid tax errors.
I hope that this information has been helpful to you. If you have any further questions or need assistance, please do not hesitate to contact me.
Best regards,
Emma Wagner
