Germany to slash value-added tax on gas to 7 pct until 2024-Xinhua

Germany to slash value-added tax on gas to 7 pct until 2024

Source: Xinhua

Editor: huaxia

2022-08-19 03:46:45

BERLIN, Aug. 18 (Xinhua) -- The German government decided to temporarily lower the value-added tax (VAT) on gas from 19 percent to 7 percent until the end of March 2024, Chancellor Olaf Scholz announced on Thursday.

"With this step, we are providing much greater relief for gas customers overall than the additional burden resulting from the surcharges," Scholz said.

Due to soaring gas prices, the German government allowed gas importers to pass on increased procurement costs to consumers through a special gas levy of 2.4 euro cents per kilowatt hour from October onwards.

The VAT reduction will apply as long as the gas levy is collected. "We expect companies to pass this reduction on to consumers on a one-to-one basis," Scholz stressed.

In addition to previous relief packages totaling 30 billion euros, Scholz also promised further state support in the coming weeks to "ease the great pressure that is weighing on many citizens, as well as businesses." (1 euro = 1.01 U.S. dollars)