Hospitality industry: Dehoga: Guests have to pay more due to high VAT

After the return of VAT to 19 percent in the catering industry, companies have increased their prices, according to the Dehoga industry association.

Hospitality industry: Dehoga: Guests have to pay more due to high VAT

After the return of VAT to 19 percent in the catering industry, companies have increased their prices, according to the Dehoga industry association.

“The significantly increased costs for food and personnel left them no other choice,” said an association spokeswoman, referring to the changes since the beginning of the year. “After three years of Corona with historic sales losses, such cost increases cannot be absorbed.”

Tax increase hits family businesses

For meals in restaurants or cafés, the rate was temporarily reduced from 19 to 7 percent during the corona pandemic to ease the burden on the industry. This exemption was extended several times due to the energy crisis, most recently until the end of 2023. For beverages it remained at 19 percent.

The tax increase will hit small and medium-sized family businesses particularly hard, especially in rural areas. “Many of our establishments report a growing price sensitivity and a reluctance to consume among guests,” said the Dehoga spokeswoman.

"Guests come less often, they consume less and forego the starter or dessert." However, there are also many guests who remain loyal to the companies. "Meeting with friends in the pub and eating in the restaurant as a break from everyday life is still very important to them."

Demand from Dehoga

Sales rose by 0.8 percent in January compared to the previous month of December, adjusted for price increases (in real terms), as the Federal Statistical Office recently announced. However, including price increases (nominal), revenue fell by 0.5 percent.

Dehoga also demands that food be taxed uniformly at seven percent. “It is absurd that 19 percent VAT applies to food in restaurants again, while food to go, ready-made salad from the supermarket and food delivery are still taxed at 7 percent,” emphasized the spokeswoman.

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