The Federal Environment Agency has called for a general abolition of VAT for foods of plant origin. “A more plant-based diet eases the burden on the environment and is also healthy,” said President Dirk Messner. Therefore, it makes sense to completely exempt plant-based foods from VAT, especially in view of the sharp increase in the price of fruits and vegetables. “Everyone should be able to afford a healthy diet, even on a low income.”
The debate on the reduction of prices of certain foods has accelerated again in the face of high inflation. Social and consumer associations have called on the federal government to use the new EU rules and set VAT at zero percent for food such as fruit and vegetables. Federal Minister of Agriculture Cem Özdemir (Greens) supported the demands. In the stoplight coalition, however, they are met with widespread skepticism. Reference is made to packages of two billion dollars with other relief measures that have already been put in place.
Messner said a VAT exemption for plant-based products would be a welcome addition. “Because it also relieves those groups that until now have barely benefited from the aid packages, for example low-income pensioners.”
In general, however, it would not have been enough to limit a VAT reform to this, Messner clarified. A comprehensive concept is needed that systematically eases the burden on environmentally friendly products and eliminates tax exemptions for products that are particularly harmful to the environment. The EU VAT Directive now offers new opportunities that must be seized. The Federal Environment Agency will present proposals shortly.
Greenpeace: benefits of meat
The environmental protection organization Greenpeace spoke in favor of not only exempting fruit and vegetables from VAT, but also eliminating concessions for meat and milk at the same time. As a result, “the federal government can just as effectively support people who now feel the pressure of inflation and at the same time fight global warming,” Greenpeace expert Matthias Lambrecht told newspapers from the Funke media group ( monday).
VAT is usually 19 percent. A reduced rate of 7 percent subsidizes products that serve the common good, including staples like milk, meat, fruits, vegetables, and baked goods.
Tax exemption also for groceries
A change to the so-called EU Value Added Tax System Directive came into force two weeks ago, largely unnoticed. Therefore, the regular tax rate must be at least 15 percent and the reduced rate must be at least 5 percent. Full tax exemptions are only possible in certain areas, and since the change this also applies to food and other goods to cover basic needs.
However, the industrial union for construction, agriculture and the environment (IG Bau) is already demanding that Federal Finance Minister Christian Lindner (FDP) work to widen the scope. “The VAT rate for the construction of social housing must be reduced to 7 percent as soon as possible and, in a second step, reduced to zero percent as soon as possible throughout the EU,” said the union’s federal president, Robert Feiger. , to the newspapers of the Funke media group (Saturday). Social housing urgently needs a boost. Otherwise, the federal government’s goal of building 100,000 new social housing units a year could be missed.
However, to prevent abuse, tax breaks would have to be tied to subsidized social housing remaining social housing in the long term, Feiger demanded: “On the principle: once social housing, always social housing.” the conversion of existing buildings should be significantly simplified.