Germany reduces VAT on gas

Germany reduces VAT on gas

In view of the rapid rise in gas prices, the German government wants to exempt consumers from VAT. In 2024, the gas tax will be 7% instead of the previous 19%, German Chancellor Olaf Scholz said in Berlin today.

Under the measure, gas customers would generally be relieved far more than they would be burdened by the state gas surcharge. According to Scholz, he expects companies to pass the tax cut to consumers on a one-to-one basis. “This is another step towards relief.”

The backdrop is the gas surcharge, which importers can use from October to pass on rising procurement costs to consumers due to the war in Ukraine. All gas users will then have to pay, whether individuals or companies – initially around 2.4 cents per kilowatt-hour. Value added tax is also levied on the fee.