VAT Rates Germany 2026

Germany's standard VAT rate is 19%. This applies to most goods and services unless a specific reduced, zero, or exempt rate applies. The reduced rate is 7%, applying to categories including food (7% (broad reduced)), books, and essential goods. Businesses with taxable turnover above the registration threshold must register for VAT, charge it on sales, and can reclaim VAT paid on business purchases.

Germany applies 7% (broad reduced) to food products. This is one of the most consumer-significant VAT rates as food is a major household expense. The exact definition of qualifying food varies — in the UK, for example, hot food prepared for immediate consumption is standard-rated at 20%, while cold food for home consumption is 0%. Restaurant meals carry different rates to supermarket food in most countries.

Germany's 19% standard rate is broadly mid-range for Europe. Hungary has the highest at 27%; Switzerland the lowest at 8,1%. Germany's 19% is below Germany; Denmark's 25% is above. The key differentiator is reduced rate coverage — Germany's treatment of food (7% (broad reduced)) and essential goods determines the real consumer cost of the VAT system.

Businesses must register for VAT in Germany when their taxable turnover exceeds the registration threshold. Non-resident businesses selling to Germany consumers may need to register for VAT if selling digital services or goods above relevant thresholds. EU businesses can use the EU One Stop Shop (OSS) for B2C digital services across all EU member states with a single registration.

Yes — VAT-registered businesses can reclaim input VAT paid on goods and services purchased for business use. The recoverable amount is offset against VAT charged on sales (output VAT). If input VAT exceeds output VAT in a period, the business can claim a refund. Businesses making only exempt supplies cannot recover input VAT. Businesses making mixed taxable and exempt supplies can partially recover input VAT using a partial exemption calculation.