Germany slashes VAT on restaurant meals to 7% in 2025 tax relief
The German Bundestag has passed a new tax law that cuts VAT on restaurant meals from 19% to 7%. The change, part of the 2025 Tax Amendment Act, aims to ease financial pressure on the hospitality sector. Officials in Baden-Württemberg have welcomed the move as a boost for local businesses and communities.
The reduced VAT rate will apply to all food served in restaurants across Germany. The decision follows years of rising costs for the industry, including steep energy bills, higher commodity prices, and growing labour expenses. These challenges have hit rural areas particularly hard.
The VAT reduction takes effect in 2025, offering relief to struggling restaurants. Lower costs for diners could encourage more people to eat out, benefiting businesses and workers alike. The change is expected to have a noticeable impact on both urban and rural hospitality sectors.
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