What is the levy for?
The gas levy is a consequence of the Energy Security Act and corresponding ordinances.
From October 2022 to April 2024, it is intended to compensate gas importers such as Uniper for 90 percent of the additional costs they have because they have to obtain replacement gas from Russia elsewhere.
The importers have so far not been able to pass on these cost increases, so there was a risk of insolvency and the collapse of the entire supply chain.
It was originally intended that the corporations should pass on the additional costs to their own customers, so this would only have affected those who received Russian gas.
The new procedure stipulates that all gas customers will be asked to pay.
So some pay more than they actually have to, others less.
Who collects the surcharge, who pays?
Business correspondent in Berlin
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Business correspondent in Brussels.
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Business correspondent in Berlin.
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The so-called market area manager Trading Hub Europe, or THE for short, is responsible, a quasi-sovereign operating company of the gas network operators.
It collects the fee from the energy suppliers.
They are allowed to get the money back from their customers, i.e. companies or households, but do not have to.
RWE has announced that it will bear the levy itself.
In this respect, there is now an inequality that politicians actually wanted to avoid: an apartment supplied by RWE does not have to pay any contribution, while the neighbor with another supplier may have to pay.
How about VAT?
The gas surcharge is part of the normal working price, which includes the procurement costs, network charges, margins, duties and other elements.
This has the advantage that the surcharge does not have to be reported to the EU Commission under state aid law, but has the disadvantage that under European law it cannot be exempted from VAT individually as part of the total price.
Finance Minister Christian Lindner (FDP) now wants to achieve such an exception in Brussels.
Until the matter is clarified, there is still 19 percent sales tax on top of that.
So 2.419 cents per kilowatt hour becomes 2.879 cents.
The levy formally came into force last Tuesday with the corresponding ordinance.
It is due on October 1st and will not be reflected in customers' bills until November.
The surcharge can be adjusted every three months, no earlier than November 9th.
The gross-net invoice can then change.
The suspension of VAT, a reduction to 7 percent or a reduction in the levy to 2.033 cents is conceivable, so that the VAT burden remains at 2.419 cents.
The energy association BDEW is calling for the tax rate on gas and electricity to be reduced to 7 percent between 2023 and 2025.
Can the tax be eliminated?
EU law is actually quite clear on this point: the VAT directive allows for a reduction in rates, but no exemption.
Lindner therefore asked the responsible EU Commissioner Paolo Gentiloni in a letter dated August 12 to change the applicable law.
However, because this cannot be done by decree, but has to go through the normal – and lengthy – legislative process, this is ultimately not a viable option for the gas levy.
Lindner therefore also wants to apply for an exemption based on Article 395 of the VAT Directive.
In doing so, he refers – with some creativity – to the “special measures” permitted therein in order to “simplify tax collection”.