The federal government is scheduled to abolish a controversial tax privilege for the Deutsche Post. As reported by Spiegel, the still partially state-owned corporation will no longer be exempt from value-added tax (VAT) when collecting and distributing business mail.
This measure removes a competitive advantage that the Post held over its rivals, an advantage that previously totaled 19 percent. The situation had been complicated by the fact that several private postal operators were given access to the exemption in the interim, which exacerbated the difficulties faced by the remaining competitors.
Finance Minister Lars Klingbeil (SPD) is implementing this change, a move which will provide the government with additional revenue-which he notes is needed in light of the strained budget situation-and estimates this income at 115 million euros.
Postal competitors welcome Klingbeil’s action, though they believe the governmental estimate is too low. The federal association of postal services, represented by Chairman Walther Otremba, predicts that the influx of revenue will be at least half a billion euros, stating that “fair competitive conditions in the mail market will finally be established again” after years of imbalance.
