Abolition of VAT for certain foods: Financial expert supports demand from Özdemir, Federal Environment Agency and VZBV

According to Federal Agriculture Minister Cem Özdemir (Greens), the Federal Environment Agency and the Federal Association of Consumer Organizations (VZBV) are also in favor of abolishing VAT for certain foods. “The VAT exemption for plant-based food counteracts the high price increase for food,” said UBA President Dirk Messner to the “Handelsblatt”. “It should be implemented as quickly as possible, because everyone in Germany should be able to afford a healthy and climate-friendly diet.” VZBV boss Ramona Pop also sees a need for action. “The abolition of VAT on fruit, vegetables and legumes is long overdue in order to ease the burden on the wallet in times of high prices and also to provide incentives for a healthier diet,” Pop told the “Handelsblatt”. “A healthy, varied and sustainable diet should not be a question of budget in a rich country like Germany.” In the newspapers of the Funke media group, Özdemir had shown “great sympathy” for “setting the VAT for fruit, vegetables and legumes to zero”.

The demands of the Federal Environment Agency and the Federal Association of Consumer Organizations (VZBV) for the abolition of VAT on certain foods such as fruit, vegetables and legumes has the potential to have a significant impact on the market and consumers in Germany. Exemption from VAT for these healthy foods would lead to a price reduction and facilitate access to a healthy and climate-friendly diet. This could in turn create an incentive for consumers to switch more to plant-based foods and thus contribute to a more sustainable diet.

High inflation since the start of the Ukrainian war has led to a 21.1 percent increase in food prices in November 2022 compared to the same month last year. This increase was more than twice as high as overall inflation, which was ten percent. Eliminating VAT on fruits, vegetables and pulses would help mitigate at least some of the price increases for consumers and allow them to buy healthy foods more affordably.

However, the Ministry of Finance has already stated that there are no considerations to abolish VAT on healthy foods. It therefore remains to be seen whether and when such a measure will be implemented. Nevertheless, the demand for a VAT exemption for fruit, vegetables and legumes is an important step towards an affordable and healthier diet for consumers in Germany.