Altmaier, Seehofer: markets should pass on VAT reduction

Federal Minister of Economics Peter Altmaier (CDU) is against a VAT reduction beyond 2020. If it were not for the reduction to expire, there might be a great risk for the measure to fizzle out since people would not engage in investment in time. They would instead continue to hesitate in consumption. Momentum from the government stimulus package was needed now. Altmaier said he believed that the market would ensure that businesses and businesses pass on the VAT reduction to consumers. Federal Minister of the Interior Horst Seehofer (CSU), in his words, also trusts that the economy, the automotive industry and others, passes on the VAT reduction to customers.

Recently, there were voices from industry and trade, but also from the Chamber of Tax Advisors, criticizing that price lists had to be created and prices had to be re-labeled in the wake of the VAT reduction, which has been agreed upon for 2020. The Chamber of Tax Advisers pointed out that “All ERP and accounting systems” as well as “the tax rates have to be adjusted”. The Federal Ministry of Finance has yet to submit a letter of application regarding the VAT reduction.

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