Value Added Tax in the hospitality industry: Petition against planned increase
The COVID-19 pandemic has caused significant economic damage worldwide and particularly in the hospitality industry. In response, Germany reduced the value-added tax in the hospitality sector from 19 to 7 percent to support the businesses during these tough times. This reduction is now planned to be reversed, and it will no longer apply in 2024.
Relieve the Hospitality Industry
The federal government, through the so-called Corona Tax Relief Act of June 2020, reduced the financial burden on the hospitality industry. It served as a stimulus to boost the economy in one of the sectors hit hardest. Now, however, a new change to these tax rates is under debate, and the government plans to increase the value-added tax in the hospitality industry again from 7 to 19 percent in 2024. This decision is causing great incomprehension and disappointment within the industry.
Many hospitality providers believe that such an increase at this time would be premature, as many restaurants and eateries are still recovering from the economic losses of the pandemic and are further burdened by high energy costs. The reinstatement of the higher value-added tax could disrupt the fragile balance that many businesses have only just regained.
7% Value-Added Tax: Sign the Petition
In line with this, DEHOGA has launched a petition addressed to the federal government. Under the banner "Seven Percent Must Remain!", the German Hotel and Restaurant Association has gathered seven plausible reasons that argue against the increase. Supporters of this petition argue that a return to the 19-percent tax rate at this time could endanger the recovery of the hospitality industry and could put countless businesses in serious financial difficulty. They are calling on the government to maintain the current rate in order to support the industry and preserve jobs.
Sign the petition here