Accordance » Germany

German VAT ‘not on the rise’

admin — Mon, 29 Jun 2009 11:51:34 +0000

German chancellor Angela Merkel has countered claims that the rate of VAT charged in the country is set to be increased.

Last week, speculation emerged that ministers were reportedly looking to increase the tax from seven to 19 per cent in a move designed to cut the government’s rising budget deficit.

However, the chancellor hit back at the claims in an interview with Bild am Sonntag and suggested that such talk could impact on economic activity in the country.

"With me, there will be no increase in the next legislative period, neither of the full- nor of the reduced-rate of value added tax," she added.

One country which will soon see a VAT increase is Estonia, and the country’s prime minster Andrus Ansip has claimed the move will not have a negative impact on the area.

He told E24.ee that it was wrong to suggest the move could harm the economy, reported Baltic Business News.

Germany set for VAT increase?

admin — Thu, 25 Jun 2009 11:22:08 +0000

Politicians in Germany are believed to be considering an increase in VAT, according to reports.

The Local claims that reports in national newspaper Bild have suggested chancellor Angela Merkel is looking at upping the current reduced rate of seven per cent to 19 per cent.

It is hoped that such a move would boost finances for the government by around €14 billion (£11.9 billion), as its budget deficit is believed to be on the rise.

However, ministers are not thought to have agreed on the proposal, as other combinations of tax changes are being mulled over as potential alternatives.

Reports that the rate of VAT in Serbia is set to be increased were recently quashed by the country’s deputy prime minister and minister of economy and regional development, Mladjan Dinkic.

He told Emportal.rs that the government is looking at other measures to improve budget revenues.

VAT increase ‘would cut German state debt’

admin — Fri, 29 May 2009 11:57:47 +0000

New research has suggested that increasing the rate of VAT offered in Germany could cut state debts.

The study by the German Institute for Economic Research (DIW) has claimed that upping the rate by six per cent from the start of 2011 would help the government to raise funds for its budgeting plans.

According to Deutsche Welle, VAT in the country was last raised in 2005.

Klaus Zimmermann, the president of DIW, told Rheinische Post that the threat of a VAT increase would instantly encourage people to buy goods, as they would want to get hold of them before prices go up.

He added: "There is no other way the government can balance its books."

Hungary recently announced plans to increase its VAT rate by five per cent at the start of July.