Relief for gas customers

Value-added tax on gas to be reduced Relief for gas customers

In view of the increase of gas prices, the Federal Government wants to provide value-added tax relief for consumers. Federal Chancellor Scholz announced in Berlin that in future the tax on gas consumption would be 7 rather than 19 percent as has been the case to date. This rule is to remain in place until March 2024 – for the same period in which the gas surcharges will also apply.

Foto zeigt Bundeskanzler Scholz

The Federal Chancellor stressed that the Federal Government would not abandon anyone in this time of crisis, and that an additional relief package was to be put together over the next few weeks. 

Photo: Federal Government/Kugler

The Federal Government plans to reduce value-added tax on gas consumption to seven percent until 31 March 2024. “With this step we are providing relief to gas customers that is far greater on the whole than the additional amount that arises due to the surcharges,” Federal Chancellor Olaf Scholz said. He continued to point out that he expects companies to fully pass on this tax reduction to consumers, and that this would be communicated clearly.

The decision was made against the background of the gas surcharge that allows for higher purchasing costs to be passed on to consumers, who will have to pay an additional 2.419 cents per kilowatt hour. A balancing and storage surcharge will also apply alongside the gas surcharge, as well as value-added tax on these surcharges.

Third relief package underway

“Fairness is key when it comes to keeping our country united in this crisis,” Federal Chancellor Scholz stressed. He said that reducing value-added tax on gas consumption was another step to provide relief,

and continued to explain that the Federal Government would not abandon anyone in this time of crisis, and that an additional relief package was to be put together over the next few weeks. Discussions about the exact form of this package were currently taking place in confidence, he said.

Video statement by Federal Chancellor Scholz regarding the reduction of value-added tax on gas (German)

An overview of the effects of the adopted relief measures is available here.