Germany Postpones Holiday Tax Until 2027

In a recent development, the German Finance Ministry has made a significant decision regarding the value-added tax on Germany vacations.

As per the European tour operator trade group ETOA, this tax will now be deferred until the year 2027. This decision is expected to have a notable impact on the tourism industry within the country.

Tour operators selling Germany are celebrating a recent victory, as the implementation of VAT could have resulted in higher costs for non-EU customers acquiring travel packages.

In a surprising turn of events, the implementation of the Value Added Tax (VAT) has been consistently delayed on a yearly basis since its intended launch in 2021. In a recent twist, the much-anticipated VAT implementation has faced yet another delay, as authorities decided to defer the fee in order to allow for a thorough review of the tax system before its eventual implementation.

This move is believed to be primarily driven by anticipated law reforms that are expected to be implemented in the coming years.

During a webinar call with members on July 24, ETOA CEO Tom Jenkins stated that the postponement of the implementation is not solely due to practical challenges but also in response to the upcoming reforms announced by the European Commission.

In a recent statement, Jenkins highlighted Croatia's move to adopt its own Value Added Tax (VAT) system, drawing parallels to Germany's approach. Despite concerns, the country has shown no signs of postponing the implementation of these supplementary tax regulations, leading Jenkins to label it as a minor setback.

Jenkins, a prominent figure in the tourism industry, has also issued a cautionary message to tour operators who are currently selling Croatia as a destination outside of the European Union. According to the CEO, it is imperative for these operators to ensure that they are registered for VAT in Croatia and to properly account for this tax.

 

Source: travelweekly.com