Compensating for inflation: Olaf Scholz proposes a decrease VAT charge on meals | EUROtoday

Chancellor Olaf Scholz (SPD) has spoken out in favor of decreasing the VAT charge on meals from seven to 5 % to assist low-income households. “I think it’s important now that we do something very manageable that everyone notices every day when it comes to their daily needs,” mentioned Scholz on ARD.Topics of the day.

The discount would “help a lot of people who earn little money. And it wouldn’t be an excessive burden on the federal budget,” Scholz continued. Despite the autumn in vitality prices, many would nonetheless really feel the impression of inflation. “It’s about food, what you have to pay at the checkout in the supermarket. And some people are quite surprised at the amount of money that comes together for the basket that they have filled,” mentioned the SPD politician.

When requested whether or not this lowered charge also needs to apply to the catering trade, Scholz didn’t remark. Scholz mentioned of the inflation of the previous few years: “A big war in our neighborhood, terrible consequences for our economy when suddenly half of the gas was missing. We managed all of that.” However, the nation remains to be chewing on it.

In July 2023, CSU boss Markus Söder even known as for VAT to be suspended on primary meals together with meat, fish and milk. The then SPD General Secretary Kevin Kühnert mentioned on the time that there have been “better proposals” to alleviate the burden on households with small and medium incomes.

In 2020, the VAT charge on hygiene merchandise for menstruating individuals was lowered from 10 to 7 %. However, a examine revealed in August 2024 concluded that the reduction had not reached customers as a result of producers had elevated costs.

The proposal comes simply at some point earlier than the Chancellor needs to request a vote on the vote of confidence subsequent Monday in a letter to the Bundestag on Wednesday. If he loses this vote as anticipated, Scholz would solely be in workplace as performing chancellor till the deliberate new election on February twenty third. His scope for additional selections is proscribed anyway, as his red-green authorities not has a majority within the Bundestag after the site visitors gentle coalition broke.