A reduction in VAT on restaurant food introduced at the beginning of the year has not resulted in lower prices for consumers, according to a study commissioned by the hospitality union NGG. Just one percent of the dishes examined became cheaper, according to the study presented in Berlin on Thursday. At the same time, many employees in the sector are increasingly “running on empty” because of heavy workloads, the union criticised.
For the price study, consulting firm WMP Consult compared the prices of around 180,000 dishes at 12,000 restaurants before and after the tax reduction on behalf of NGG. Prices remained unchanged in 91 percent of cases. At the same time, eight percent of the dishes became more expensive.
Price increases were particularly common for bowls, with 14 percent becoming more expensive, followed by schnitzels at 11 percent and steaks at 10 percent. On average, prices increased by 0.5 percent, NGG said. “Restaurant guests are therefore not benefiting from the VAT reduction.”
The VAT rate on food served in restaurants was permanently reduced by the German government from 19 percent to the reduced rate of seven percent on January 1, 2026. According to the government, the purpose of the measure was to specifically strengthen the hospitality industry, which had come under increasing pressure in recent years due to falling revenues and rising costs. However, the government also said that citizens would “feel the measure in their wallets”, as a government spokesperson stated last September.
In reality, however, nothing had reached consumers, NGG chairman Guido Zeitler criticised. He also said it was problematic that employees had so far not benefited from the “tax gift to the industry”. In the ongoing collective bargaining negotiations with the German Hotel and Restaurant Association (Dehoga), NGG was encountering a strong resistance to wage increases, he said.
The workload for employees was also high, said Mark Baumeister, NGG’s head of hospitality sector policy. A nationwide survey of employees conducted by the union found that 71 percent of respondents were considering leaving the industry. Baumeister described this as an “alarm signal”.
The survey involved 2,120 hospitality workers questioned in June and July. Almost one in two said they regularly worked eight to ten hours a day, while ten percent worked even longer. In addition, 79 percent reported short-notice changes to their work schedules, making it more difficult to balance work with family and private life.
Against this backdrop, 96 percent of respondents supported limiting the maximum daily working hours. “People are burning for the industry, but they do not want to be burned out by the industry,” Baumeister said.
The union generally believes employers have a responsibility to improve wages and working conditions, particularly because they have so far kept the tax relief for themselves, according to NGG. The union’s demands include better incomes for employees, maintaining the Working Hours Act and the eight-hour working day, and stronger collective bargaining coverage. It is also calling for measures to secure skilled workers in the industry over the long term.
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