7 instead of 19 percent
Traffic light politician for VAT reduction on plant milk
08/26/2023, 10:19 am
A VAT rate of seven percent applies to staple foods such as vegetables, meat and cow’s milk. In contrast, milk substitutes are taxed at 19 percent. Politicians from the SPD and the Greens want to change that.
From the ranks of the SPD and the Greens comes the proposal to reduce the VAT rate on milk substitutes. In the future, these should be taxed like cow’s milk at 7 instead of 19 percent, taking into account changed eating habits. “I can very well imagine reducing the VAT on milk substitute products to seven percent in the short term as part of the upcoming negotiations on the annual tax law on January 1, 2024,” said tax expert Tim Klüssendorf from the SPD parliamentary group in the newspaper “Welt am Sonntag”. . An adjustment of the different rates for staple foods, such as oat or soy drinks, is long overdue.
The SPD politician received support from Green MP Bruno Hönel: “With the change in eating habits in recent years and decades, plant-based milk, for example, has become an everyday alternative to cow’s milk for many. It is also more climate-friendly,” said Hönel. The unequal tax treatment is therefore rightly met with a lack of understanding and is difficult to maintain in terms of content. However, the realization is “depending on the budgetary leeway”.
Accordingly, the VAT expert of the FDP parliamentary group, Till Mansmann, expressed reservations. “The following applies to everything: we first have to wait for the tax estimate and make decisions on this basis,” he told the newspaper. The new estimate will be published in autumn.
The German Economic Institute (IW) would go one step further than the Greens and SPD and extend the reduced VAT rate of seven percent to all non-alcoholic beverages. “That would not only end the differentiation between cow’s milk and vegan milk substitute products, but would finally mean uniform tax rates for almost all foods,” IW tax expert Martin Beznoska is quoted as saying by the “Welt am Sonntag”. The rate of seven percent already applies to staple foods such as potatoes, vegetables or meat, while the higher rate of 19 percent has so far largely applied to beverages.