display
Less than two weeks, then the biggest tax hike in 14 years is due for all consumers.
The regular VAT rate will be increased from 16 percent to 19 percent on January 1, the reduced rate from five to seven percent - just like at the beginning of 2007.
At that time, too, the Chancellor's name was Angela Merkel (CDU), and the SPD provided the Federal Minister of Finance.
But that's enough of the parallels.
Unlike in 2007, this increase does not lead the country into completely new tax regions.
Instead, after six months at a lower level, the tax status that was in place until June 30, 2020 will be restored.
display
With the interim reduction, Merkel and her finance minister Olaf Scholz wanted to tempt Germans to consume - in order to support trade and thus the entire economy.
For this they were prepared to forego 20 billion euros in tax revenue.
The judgment of the trade is clear
It was probably a € 20 billion mistake.
This can be seen at the latest now that prices are going up again.
The judgment of the trade is clear.
"Overall, the tax cut could not do anything against the negative effects of the pandemic on consumption and so far has only had a marginal effect," says Stefan Genth, General Manager of the German Trade Association (HDE), WELT AM SONNTAG.
For most companies, the effort was significantly higher than the benefit.
display
At the drugstore chain Rossmann, the general price cut wanted by politicians was independently revised upwards months ago.
"We withdrew the three percent discount in the last week of September - without our customers noticing," it says from there.
It is not a problem to take back something that nobody notices.
In the past three months, for example, the VAT reduction no longer ended up with customers, but with the company's cash register.
Even in the fashion trade, which is particularly affected by the corona restrictions, the verdict is clear: "No effect at all", so the brief conclusion of the fashion and lifestyle company Breuninger, which is represented in many large cities.
There was only more sales for expensive products
display
At most, an effect could be observed in the trade in high-priced goods, such as furniture.
"Incoming orders have increased significantly from July, especially for kitchens, upholstered furniture and high-quality home furniture," says Jan Kurth, General Manager of the Association of the German Furniture Industry (VDM).
If a major purchase was planned for the near future anyway, this has now been brought forward.
At a price of several thousand euros, a tax cut of three percentage points is definitely noticeable.
But even for many economists, this is no justification for a 20 billion program.
In its annual report, the Council of Economic Experts with the most important economic advisors to the federal government also criticized the low level of target accuracy of the tax cut: "The effect on the economy should remain limited," it says.
Households with higher incomes reacted more strongly to the measure, but this meant large deadweight effects.
In other words, customers with high incomes would have bought the new kitchen or car anyway.
Finance Minister Scholz nonetheless relentlessly defends the expensive cut: “We have made an offer to make major purchases despite the crisis.
That worked. ”And when asked, his ministry added that it was a matter of“ initiating a considerable economic stimulus in a timely manner. ”
This goal has been achieved.
But even Scholz's people do not dare to claim that the strong economic growth of 8.5 percent in the third quarter would not have been achieved without the VAT cut.
"The scope for price increases will be limited"
The hard lockdown and the already difficult situation in trade could ensure that the VAT cut will not turn into a debacle.
display
In normal times, the step back up is the risky one.
Scientific studies from other countries show that sales tax increases are passed on to customers twice as much as temporary reductions.
"In view of the high competitive pressure, the scope for price increases will be extremely limited," says HDE boss Genth.
In the case of fashion and shoes, there is even an unprecedented drop in prices.
"If the shops are allowed to reopen, there will be a huge wave of discounts," says Axel Augustin, spokesman for the textile trade association.
The industry is sitting on a huge mountain of unsold goods, we're talking about 300 million parts.
Anyone who has a strong online business can act more freely.
"We will take into account the VAT applicable from January 1, 2021 in our prices," says the electronics store chain MediaMarktSaturn.
Whether consumers actually notice this in view of the dynamic prices, which can change several times a day, is an open question.
Mail order company Otto also points out that the VAT rate is only one component of many in pricing.
In the next few months there will always be extensive special offers.
It gets exciting in the grocery trade.
Aldi wants to return to the old level, the same applies to the Rewe Group with the Rewe and Penny stores.
But it is also clear: If you leave the prices as they are from January onwards, the price game changes suddenly.
At the Schwarz Group, with Lidl and Kaufland, you don't look your way: “We will continue to offer our customers an attractive price-performance ratio in the future.” That could mean a lot.
This text is from WELT AM SONNTAG. We will be happy to deliver them to your home on a regular basis.