The incoming reduction in value-added tax (VAT) on food in restaurants is unlikely to be passed on to consumers in its entirety, according to representatives of the hospitality sector. Ingrid Hartges, Managing Director of the German Hotel and Restaurant Association (Dehoga), stated that the extent to which price reductions will be implemented depends significantly on the development of costs, particularly regarding raw materials and personnel. Each restaurant owner will ultimately decide how to adjust pricing.
Hartges’ comments contradict statements made by Federal Finance Minister Lars Klingbeil, who, during the presentation of the 2026 federal budget, asserted that the planned VAT reduction from 19% to 7% should be reflected in lower prices for consumers, making dining out more affordable. Klingbeil emphasized that this was an expectation, rather than a threat.
Hartges tempered these expectations, suggesting that businesses are more likely to utilize any available financial flexibility to invest in improvements and create appealing offers for guests. She also drew attention to the upcoming increase in the minimum wage, scheduled to take effect on January 1, 2026, representing an increase of approximately eight percent. Hartges stressed the importance of securing the viability and strengthening the diversity of the restaurant sector, which currently faces intense competition from food options subject to the lower 7% VAT rate, such as takeout and delivery services.