Vat in Germany

Vat in Germany

There are two VAT rates in Germany: a standard rate of 19%, reduced rate of 7%.

There are two VAT rates in Germany:

  • a standard rate of 19%
  • reduced rate of 7%.

The standard rate of German VAT applies to most goods that are not subject to the reduced rate.

The reduced rate of VAT in Germany applies to various everyday products and services.

The following goods are subject to a reduced rate of VAT in Germany:

  • Live animals
  • Meat and offal
  • Fish and shellfish
  • Milk and milk products and eggs, excluding soya milk and oat milk
  • Flowers, bulbs, and tubers, cut flowers, leaves, and branches
  • Vegetables, plants, and roots, as well as fruit and nuts suitable for use as food
  • Coffee, tea, spices
  • Animal and vegetable fats and oils
  • Sugar and confectionery as well as cocoa powder
  • Books and newspapers
  • Art objects such as paintings and drawings or sculptures
  • Collectors items, such as postage stamps, coins, zoological and botanical items, as well as historical and archaeological items.

Services subject to a reduced VAT rate in Germany are:

  • Animal husbandry and plant growing
  • Dental services
  • Admission fees to the theatre, concerts, museums, circus performances, and zoos
  • Rail transport
  • Public transport within the municipality and taxis up to 50 km
  • Accommodation in hotels, restaurants, and camping sites
  • Services provided by charitable and church institutions

Who has to pay taxes in Germany?

Foreign entrepreneurs are required to register for VAT if they

  • Sell to non-business people by mail order from abroad, the value of which exceeds EUR 100,000 in a calendar year
  • They provide construction services in Germany to non-business people
  • Provide passenger transport services in Germany
  • Import goods into the customs territory of the European Community with a view to their release for free circulation in Germany
  • Transport to Germany goods acquired in the other Member States of the European Union
  • Deliver goods from Germany, i.e. sell goods which are in Germany at the time when dispatch or transport begins
  • Are recipients of construction services provided by foreign subcontractors
  • Have a permanent establishment in Germany through which they conduct part or all of their business activities

Tax exemptions in Germany

Exemption from turnover tax exists in the following cases:

  • Trade with sea and air navigation
  • Delivery of gold to central banks
  • Intermediation in exports and sea and air navigation. However, travel agencies offering or intermediating travel services, whose intermediation turnover is subject to tax, may not benefit from this exemption
  • Supply of new cars for certain groups (e.g. NATO, diplomatic missions, etc.).
  • Turnover subject to real estate tax
  • Turnover derived in accordance with the Lotteries and Betting Act.
  • Turnover derived in accordance with the Insurance Tax Act.
  • Supply of human organs and blood
  • Health services provided inter alia by doctors, dentists, psychotherapists, physiotherapists
  • Educational and training services provided also by public schools or other training centers
  • Turnover from academic activities of higher education institutions, subject to certain exemptions

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