Finance Minister Christian Lindner says he is examining all options for exempting the planned gas levy from VAT. “As Federal Minister of Finance, I do not want to tax the gas surcharge,” said the FDP politician to the German Press Agency.
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It is absurd to burden gas customers even more as a state. However, the federal government is bound by EU law. “I will now exhaust all legal and political options to avert an additional burden,” promised Lindner. New burdens are not necessary, but relief for the broad middle.
From circles in the Ministry of Finance, it was said that the Ministry of Climate Protection and Economic Affairs designed the surcharge in such a way that, according to European law, VAT should actually be incurred.
Federal Economics Minister Robert Habeck (Greens) had previously demanded that citizens should not be additionally burdened with VAT in the planned gas levy. “It would be wrong to charge VAT on the levy,” Habeck told the Tagesspiegel.
“The surcharge is a difficult step, but it is necessary to ensure the gas supply. But it should not be additionally increased by value added tax,” emphasized the Vice Chancellor. “I am sure that the colleagues in the Ministry of Finance see it that way,” he said. Legally, including under European law, this is complex. But he hopes that the Federal Ministry of Finance will find a way.
For a household of four, the levy can mean additional costs of up to 1000 euros – in addition to the price increases that are already possible in the contract with certain deadlines.
With 19 percent VAT, it would be significantly higher and the state would still earn through the tax revenue.
According to Habeck, the gas surcharge should be between 1.5 cents and five cents per kilowatt hour (kWh). According to the comparison portal Verivox, a kilowatt hour currently costs an average of around 26 cents, a year ago it was less than six cents. The additional gas surcharge alone could account for almost as much.
For a family with an annual consumption of 20,000 kWh, this means additional costs of between 357 and 1190 euros, taking into account VAT, says Verivox expert Neubauer. All in all, the additional burden for a family could amount to up to 4000 euros a year, i.e. more than the costs of a vacation lasting several weeks.
According to the comparison portal Verivox, the levy without VAT could be 14 to 48 euros lower for a single household, 34 to 114 euros for a couple household and 57 to 190 euros for households with a single-family house.
The exact amount of the levy is to be published in mid-August. The federal government is therefore looking for additional relief options. According to the cabinet decision, the ordinance introducing the surcharge is expected to come into force in mid-August and take effect from October 1st.
It applies in accordance with the legal requirements of the Energy Security Act until 2024. With the levy, companies importing gas from Russia should be able to pass on 90 percent of the additional costs incurred by procuring gas from other sources.
The industry is under pressure because cheap gas supplies from Russia have been significantly reduced. Now the companies have to buy gas elsewhere on the fly for much more money in order to be able to serve their customers. This has put Germany’s largest gas importer Uniper in such trouble that the state has to invest billions.
It is becoming apparent that VAT will not apply here, but the anxious question in political Berlin is, is that enough? Chancellor Scholz finally promised “You’ll never walk alone”. At the same time, Lindner wants to comply with the debt brake again in 2023. Although further relief has been announced, especially for the unemployed and recipients of housing benefit, the consequences of Putin’s delivery blockade will hit the middle class hard.
Christoph Meyer, deputy parliamentary group leader of the FDP, warns of new relief with the watering can when asked by the Tagesspiegel. Further one-off payments would only create more “bureaucracy monsters” and “possibly even fuel inflation”. SPD faction deputy Matthias Miersch recalls that the EEG levy on the electricity price has already been abolished and a 300-euro lump sum for energy costs will be paid out in September. But he made it clear to the FDP that that would not be enough.
“I’m concerned that families and pensioners in particular, who earn just too much for transfer payments, can no longer bear the burden of the rising costs.” In order for the burden on small and medium-sized incomes not to get out of hand, the current over-profits would also have to distributed fairly in the energy industry. “We can’t explain to anyone that some energy companies are making billions in excess profits, but energy importers have to be supported by gas customers,” Miersch told the Tagesspiegel.
Green parliamentary group leader Andreas Audretsch also wants this to create scope for relief; FDP parliamentary group leader Meyer is strictly against an excess profit tax. That would put further strain on the economy and jeopardize jobs. With regard to the industry, which is trembling due to high prices and gas bottlenecks, Audretsch emphasizes that new aid programs are also needed here. Thus, the traffic light here faces tough financial debates. The SPD politician Miersch calls for an energy-saving summit to be held in the Chancellery as a first step, at which municipalities, states and the federal government set binding savings targets.
