The head of the hospitality union, Nahrung Genuss Gaststätten (NGG), Guido Zeitler, has vehemently rejected calls for a permanently reduced value-added tax (VAT) on restaurant meals, arguing the policy would disproportionately benefit high-end diners while failing to address the underlying struggles of hospitality workers. Zeitler’s critique, delivered in an interview with “Der Spiegel”, challenges the economic rationale frequently presented by industry advocates pushing for the tax break.
The proposed permanent reduction, slated to take effect January 2026, lowering the VAT rate from 19% to 7%, would reportedly cost the state treasury approximately four billion euros annually. Zeitler argues this represents a substantial subsidy primarily benefiting patrons of upscale establishments, a stark contrast to the financial realities of many hospitality employees. “This is not aligned with the living conditions of workers often accused of being overpriced or underperforming” he stated.
Zeitler insists that government resources are better allocated to initiatives that directly support hospitality workers, such as housing assistance, wage supplementation for low earners and accessible public transportation. He emphasized that many within the industry rely heavily on such support.
Critically, Zeitler questioned the efficacy of tax reductions as a mechanism for improving worker conditions, citing the 2010 VAT reduction for hotels as a cautionary example. “Employees rarely benefit when employers pay less tax. After the 2010 VAT reduction for hotels, virtually nothing trickled down to the workforce. Many employers simply pocketed the savings.
The Dehoga, the hospitality employers’ association, has already signaled that individual establishments will determine how, if at all, they utilize the tax reduction, raising concerns about whether cost savings will be passed on to consumers through lower menu prices, or retained as profit. Zeitler’s intervention injects a crucial worker’s perspective into the debate, questioning whether the proposed tax break serves the wider public interest or merely provides a windfall for business owners, further exacerbating inequalities within the hospitality sector.
