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Generic Tax Name VAT
Tax name in the national language Umsatzsteuer
Tax name in English Value-added tax
Member State DE-Germany
Tax in force since 1968/01/01
If abolished, date on which the tax ceases to apply
Business version date 2015/01/01
Version date 2015/02/17
This file was last updated on

Type of tax
Direct taxes Personal income tax
Corporate income tax
Other

Indirect taxes VAT
Excise duty (EU harmonised)
Alcoholic beverages
Energy products and electricity
Manufactured tobacco
Other

Social security contribution Employers
Employees
Other
 
Legal base

The legal basis for the imposition of value-added tax comprises the VAT Act as published on 21 February 2005 (Federal Law Gazette 2005 I p. 386) last amended by Articles 9, 10 and 11 of the Act of 22 December 2014 (Federal Law Gazette 2014 I p. 2417).

 
Who sets
The tax rate is set by




The tax base is set by




The reliefs are set by




Comments
 
Beneficiary





Comments

 
Geographical Scope
Territories excluded (article 6 2006/112/EC)

The territory of the Federal Republic of Germany except the territory of Büsingen, the island of Heligoland, the free zones of the control type I under section 1 subsection (1), first sentence of the Customs Administration Act (free ports), the waters and foreshores between the border and the respective shoreline as well as German ships and German aircraft in areas not belonging to a customs territory.



Comments
 
Taxpayers
Included taxable persons doing occasional transactions (article 12 2006/112/EC)


Comments

Special scheme for SMEs (article 281 2006/112/EC and following) None
Exemption
Graduated relief
Turnover threshold:
Comments

Turnover Threshold: € 17,500 respectively € 50,000


Common Flat-rate scheme for farmers (article 295 2006/112/EC and following) None
All categories
Some categories
Flat rate compensation percentage (general):
10.70 %
Flat rate compensation percentage for forestry:
5.50 %
Flat rate compensation percentage for fisheries:
10.70 %
Comments

Agriculture, forestry


There is a special scheme on the following





Comments

Special derogations to continue to tax (annex X)




Comments

Special derogations to continue to exempt (annex X)













Comments


Comments

As a consumer levy, VAT is so designed as to fall on final consumer expenditure. How­ever, it would be technically in­feasible to col­lect VAT from the con­sumer, and tax liability there­fore attaches to entrepreneurs who realize a taxable turnover (or, under the reverse-charge system, to the entrepreneurs receiving goods or services). They are in turn obliged to pass on VAT to the recipient of their goods or services by including it in the price they charge. Entrepreneurs will frequently indicate this by showing the amount of VAT separately on their invoices for taxable turnover. On invoices to other entrepreneurs and legal entities they are in fact bound to show the amount of tax separately. The same applies in the case of taxable supplies under contract for work and materials or other supplies in connection with an item of real property. VAT is classified as an indirect tax in view of the fact that it is collected from the consumer by way of the entrepreneur.

 
Tax object and basis of assessment
The following items are regarded as supply of goods and hence taxed under VAT (article 14 - 15 2006/112/EC)




Comments

The following items are regarded as supply of goods and hence taxed under VAT (article 18 2006/112/EC)



Comments

By derogation to article 26 paragraph 1, the following item(s) are not regarded as supply of services and hence not subject to VAT (article 26(2) 2006/112/EC)


Comments

By application of article 27 of 2006/112/EC, the following item is treated as supply of services The supply by a taxable person of a service for the purposes of his business, where the VAT on such a service, were it applied by another taxable person, would not be wholly deductible
Comments


Comments

All public and private consumption (i.e. goods and services supplied to the final consumer).

VAT is payable on

  • supplies and other performances;
  • imports (import VAT); and
  • intra-Community acquisitions.

Value-added tax (or turnover tax), which in the tax system is classified among taxes on income, property and transactions (with the exception of import VAT) has the economic effect of a broadlybased excise duty and is chargeable as a rule on all public and private consumption (i.e. on goods and services supplied to the final consumer). It differs in this respect from income tax and wages tax, which take account of the individual taxable capacity of each taxpayer.

Value-added tax cannot have a cumulative effect. That is to say there can be no tax on tax. This is ensured by providing for the deduction of prior VAT (referred to as input tax).

Entrepreneurs are entitled to deduct from the tax payable on their turnover the input tax charged to them on invoices rendered by other entrepreneurs for their taxable supplies. The VAT paid on intra-Community acquisitions is also deductible as input tax, as is the import VAT paid by an entrepreneur to a customs office on the importation of goods from non-EU countries.

 
Deductions, Allowances, Credits, Exemptions
Exempted sectors*

No input available


Special Measures derogating from the normal VAT rules in accordance with Article 395 of Directive 2006/112/EC*

No input available



Comments

The VAT Act provides an extensive list of goods and services exempted from VAT. The first category covers supplies for which input tax remains deductible ("zero-rated'' supplies): these are for the most part export and intra-Community supplies, certain turnover realised in sea and air transport and a number of other turnover relating to import, export and transit goods. The second category covers supplies in respect of which no input tax may be deducted ("exempt'' supplies). These include, in particular, the provision of credit the renting of real property hospital and medical care services provided by statutory social insurance funds services provided by establishments for the care of those in need of physical, mental or psychological assistance turnover realised by entrepreneurs who are registered blind persons and services provided by voluntary welfare organisations, private schools, theatres, orchestras, museums, zoos, educational facilities and youth welfare services.

VAT is not imposed on entrepreneurs resident in Germany, in a free zone or in certain regions of the coastal waters whose turnover (plus the VAT payable thereon) did not exceed € 17,500 in the previous calendar year and is not expected to exceed € 50,000 in the current calendar year (small-scale entrepreneurs).

However, such persons are not entitled to deduct any input tax charged to them, nor to render invoices showing tax separately. Because they are not permitted to deduct input tax, this arrangement may prove unfavourable for some small-scale entrepreneurs. The law therefore allows them to opt either for the special arrangement or for taxation in accordance with general provisions. If they opt for the latter they are bound to this decision for a period of five years.

Entrepreneurs whose previous year's turnover (plus the VAT payable thereon) exceeded € 17,500 are obliged without exception to submit to taxation in accordance with general provisions. Consequently, they are entitled to deduct input tax and must render invoices showing tax separately. The same applies to those entrepreneurs whose turnover (plus the VAT payable thereon) did not exceed the limit of € 17,500 in the previous year but is expected to exceed € 50,000 in the current calendar year.

 
Rate(s) Structure
Standard VAT rate Rate: 19.00 %
Comments

Reduced rate 1

(article 98 of Directive - Annex III of Directive)
Rate: 7.00 % on full or part of the following items

Article 98(2) 2006/112/EC

Foodstuffs (including beverages but excluding alcoholic beverages) for human and animal consumption; live animals, seeds, plants and ingredients normally intended for use in the preparation of foodstuffs; products normally used to supplement foodstuffs or as a substitute for foodstuffs
Supply of water
Pharmaceutical products of a kind normally used for health care, prevention of illness and as treatment for medical and veterinary purposes, including products used for contraception and sanitary protection
Medical equipment, aids and other appliances normally intended to alleviate or treat disability, for the exclusive personal use of the disabled, including the repair of such goods, and supply of children's car seats
Transport of passengers and their accompanying luggage
Supply, including on loan by libraries, of books on all physical means of support (including brochures, leaflets and similar printed matter, children's picture, drawing or colouring books, music printed or in manuscript form, maps and hydrographic or similar charts), newspapers and periodicals, other than material wholly or predominantly devoted to advertising
Admission to shows, theatres, circuses, fairs, amusement parks, concerts, museums, zoos, cinemas, exhibitions and similar cultural events and facilities
Reception of radio and television broadcasting services
Supply of services by writers, composers and performing artists, or of the royalties due to them
Provision, construction, renovation and alteration of housing, as part of a social policy
The renovation and repair of private dwellings, excluding materials which account for a significant part of the value of the service supplied
Window cleaning and cleaning in private households
Supply of goods and services of a kind normally intended for use in agricultural production but excluding capital goods such as machinery or buildings
Accommodation provided in hotels and similar establishments, including the provision of holiday accommodation and the letting of places on camping or caravan sites
Restaurant and catering services, it being possible to exclude the supply of (alcoholic and/or non-alcoholic) beverages
Admission to sporting events
Use of sporting facilities
Supply of goods and services by organisations recognised as being devoted to social wellbeing by Member States and engaged in welfare or social security work, in so far as those transactions are not exempt pursuant to Articles 132, 135 and 136
Supply of services by undertakers and cremation services, and the supply of goods related thereto
Provision of medical and dental care and thermal treatment in so far as those services are not exempt pursuant to points (b) to (e) of Article 132(1)
Supply of services provided in connection with street cleaning, refuse collection and waste treatment, other than the supply of such services by bodies referred to in Article 13
Minor repairs of bicycles
Minor repairs of shoes and leather goods
Minor repairs of clothing and household linen (including mending and alteration)
Domestic care services such as home help and care of the young, elderly, sick or disabled
Hairdressing

Article 102 2006/112/EC

Supply of natural gas
Supply of electricity
Supply of district heating

Article 103(1) 2006/112/EC

Pictures, collages and similar decorative plaques, paintings and drawings, executed entirely by hand by the artist, other than plans and drawings for architectural, engineering, industrial, commercial, topographical or similar purposes, hand-decorated manufactured articles, theatrical scenery, studio back cloths or the like of painted canvas (CN code 9701)
Original engravings, prints and lithographs, being impressions produced in the limited numbers directly in black and white or in colour of one or of several plates executed entirely by hand by the artist, irrespective of the process or of the material employed, but not including any mechanical or photomechanical process (CN code 9702 00 00)
Original sculptures and statuary, in any material, provided that they are executed entirely by the artists.
Sculpture casts the production of which is limited to eight copies and supervised by the artist or his successors in title (CN code 9703 00 00); on an exceptional basis, in cases determined by the Member States, the limit of eight copies may be exceeded for statuary casts produced before 1 January 1989
Tapestries (CN code 5805 00 00) and wall textiles (CN code 6304 00 00) made by hand from original designs provided by artists, provided that there are not more than eight copies of each
Individual pieces of ceramics executed entirely by the artist and signed by him
Enamels on copper, executed entirely by hand, limited to eight numbered copies bearing the signature of the artist or the studio, excluding articles of jewellery and goldsmith's and silversmith's wares
Photographs taken by the artist, printed by him or under his supervision, signed and numbered and limited to 30 copies, all sizes and mounts included
Postage or revenue stamps, postmarks, first-day covers, pre-stamped stationery and the like, used, or if unused not current and not intended to be current (CN code 9704 00 00)
Collections and collector's pieces of zoological, botanical, mineralogical, ethnographic or numismatic interest (CN code 9705 00 00)
Goods, other than works of art or collector's items, which are more than 100 years old (CN code 9706 00 00)
Comments


Special reduced VAT rate for specific regions (including articles 104 and 105 2006/112/EC) Rate:
Regions
Comments

Special provisions under article 110 2006/112/EC (existing provisions prior to 1991):No

Special provisions under articles 111 2006/112/EC:No

Special provisions under articles 112 2006/112/EC:No

Special provisions under articles 113 2006/112/EC:No

Special provisions under articles 114 2006/112/EC:No

Special provisions under articles 115 2006/112/EC:No

Special provisions under articles 116 2006/112/EC:No

Special provisions under articles 117 2006/112/EC:No

Special provisions under articles 118 2006/112/EC:No

Special provisions under articles 119 2006/112/EC:No

Special provisions under articles 120 2006/112/EC:No

Special provisions under articles 121 2006/112/EC:No

Special provisions under articles 122 2006/112/EC:Yes

No input available



Comments

Standard VAT-rate 19.00%

Reduced VAT-rate 7.00%

Most goods and services are taxed at the general rate.

The reduced rate applies in particular to the supply, importation and intra-Community acquisition of almost all foods, with the exception of beverages and catering supplies. It also applies, for instance, to local transport, to the supply of books, newspapers and periodicals and to certain art objects.

In terms of revenue, value-added tax is one of the most important taxes imposed in the Federal Republic of Germany. Given a uniform rate of tax, the present system of value-added taxation is arranged in such a way that all goods and services bear the same tax burden when they reach the final consumer. The amount of tax payable will correspond to the rate applicable to the goods or services supplied. The number of stages in the process of production or distribution that goods or services have passed through on their way to the consumer is immaterial.

 
Tax due date

The advance value-added tax payment must be made by the 10th day after the expiration of the provisional return period. The provisional return period is the calendar quarter. If the tax for the preceding calendar year exceeded € 7,500, the provisional return period is the calendar month. If the tax for the preceding calendar year did not exceed € 1,000, the tax office may exempt the entrepreneur from the obligation to submit provisional returns and make advance payments.

When the entrepreneur takes up professional or commercial activity, the provisional return period is the calendar month for the year of start-up and the following year.

The final payment of the value-added tax must be made one month after the annual tax return is filed.

 
Tax collector

The Value-added tax is collected by the tax authorities of the federal states (Länder).

 
Special features

 
Economic function







Comments
 
Environmental taxes



Comments
 
Tax revenue
ESA95 code d211a

Year
Annual tax revenue (millions)
Currency
Tax revenue as % of GDP
Tax revenue as % of total tax revenue
2012 142,300.00 EUR 5.17
2011 138,639.00 EUR 5.13
2010 135,719.00 EUR 5.26
2009 142,743.00 EUR 5.80
2008 130,950.00 EUR 5.11
2007 127,385.00 EUR 5.07
2006 111,727.00 EUR 4.67
2005 108,168.00 EUR 4.70
2004 105,107.00 EUR 4.63
2003 103,230.00 EUR 4.65
2002 103,951.00 EUR 4.71
2001 104,988.00 EUR 4.82
2000 105,847.00 EUR 5.00

Comments