German Restaurant VAT Cut Has Minimal Impact on Food Prices, Says Union
Analysis of Germany's Restaurant VAT Reduction
Overview of the VAT Cut Policy
BERLIN, Sept 17 (Reuters) - Germany's €4 billion VAT cut for restaurants has largely failed to benefit diners, with only around 1% of more than 180,000 dishes surveyed becoming cheaper, the Food, Beverages and Catering Union (NGG) said on Thursday.
The governing coalition permanently reduced VAT on food served in restaurants to 7% from 19% at the start of 2026, fulfilling a long-standing demand from the hospitality industry.
Findings from the NGG-Commissioned Study
Price Changes Across Restaurants
But a study by wmp consult, commissioned by NGG, found that prices remained unchanged for 91% of dishes examined at more than 12,000 restaurants, while around 8% became more expensive.
Theoretical Impact on Consumers
"If the tax relief had been fully passed on to consumers, final prices could theoretically have fallen by around 10%," NGG said.
Union Response and Recommendations
Union's Critique of the VAT Cut
Union chief Guido Zeitler said neither customers nor workers had benefited from the measure, calling for higher wages and better working conditions instead.
Call for Improved Labor Conditions
(Reporting by Maria Martinez and Klaus Lauer; Editing by Toby Chopra)
