Overview
- Monika Schnitzer, chair of the German Council of Economic Experts, publicly called on Saturday for the government to roll back the reduced VAT on prepared food that cut the rate from 19% to 7%.
- She says the measure costs about €3.4 billion a year and disproportionately helps big chains such as McDonald’s and Burger King rather than saving small rural inns.
- Schnitzer framed the VAT cut as an example of poorly targeted subsidies and added that diesel tax concessions are among other support measures that should be reviewed and removed.
- Her critique rests on continuing sector strain: industry data show gastronomy insolvencies rose for a fourth straight year in 2025, suggesting the tax cut has not stemmed business failures.
- The proposal is advisory only but sharpens a policy debate over fiscal sustainability and whether money saved by reversing the cut should be redirected into infrastructure upgrades and investment in technologies like AI.