Saxony's Tourism Minister Barbara Klepsch has criticized the planned expiry of the reduced VAT on food in restaurants. "I am stunned that the federal government is not extending the VAT reduction on food in restaurants after all. This is a devastating signal for the catering industry and tourism," the CDU politician told the German Press Agency. The reduced tax rate had helped the industry a great deal, as it was facing enormous challenges due to rising costs and a lack of workers. "It is to be hoped that this fatal decision by the federal government will not jeopardize the existence of many businesses," said Tourism Minister Klepsch.
The federal government recently agreed to raise the VAT rate for restaurant meals back to 19 percent from January 1. The VAT reduction was introduced in the first few months of the coronavirus pandemic in mid-2020 to relieve the industry. For some time, the rate was only five percent due to a further general VAT reduction, but since January 2021 it has been seven percent throughout. The reduction for the catering industry was repeatedly extended due to the energy crisis and high inflation at times, especially for food.
