Why is Germany increasing VAT on restaurants?

Germany is raising the VAT on restaurants as part of broader budget-saving measures to counter inflation linked to the energy crisis. The temporary reduction introduced during the Covid-19 pandemic is set to revert to 19 percent from January 1st, 2024.

Who will be most affected by the VAT hike?

The hospitality industry, particularly restaurants and school canteens, will bear the brunt of the VAT increase. Inflation-adjusted sales are already significantly below pre-crisis levels, raising concerns about closures, job losses, and potential compromises in the quality of food served.

How much will the average meal cost increase?

Assuming an average meal cost of €10, consumers can expect an approximate increase of €1.2. This rise, coupled with concerns about rising rent and energy costs, poses a considerable challenge for those watching their budgets and could influence consumer behavior in the dining sector.

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Mahek Thakre4 weeks ago
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