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From 1 January 2026 the reduced rate of 7 percent applies again to food, while beverages continue to be taxed at 19 percent. This change not only affects restaurants, but also canteens, food-trucks and event catering. For businesses this means that prices, cash register systems and processes have to be updated on time. The risks of errors and liability are particularly high at the turn of the year and in handling vouchers.

The European Court of Justice (ECJ) has clarified that tooling supplies, as they are known, are to be considered distinctly for VAT treatment and are not automatically an ancillary supply to the supply of parts, especially if the goods are not supplied in the same way. The judgement therefore has a crucial effect on the automotive and supplier industry and a direct impact on contract drafting, invoicing and input tax deduction.

In its letter on 8 August 2025, the Federal Ministry of Finance (BMF) clarified the classification of revenue from online event services in cases where services are combined. The VAT Application Decree (AEAO) has been adapted and expanded accordingly. In addition to this specification, the Federal Ministry of Finance has also dealt with when the scope of this provision is to apply. This letter completely replaces the letter dated 29 April 2024.

The tax authorities have currently got their sights on influencers – will this be followed by a second wave, with the focus moving from the influencers to the companies they collaborate with? Is your company prepared for this second wave and does your influencer marketing comply with tax and social insurance requirements? It can be expected that sponsoring and incentives will again also be closely examined.

Tax compliance is more than just a legal obligation – it protects a company and its management from unexpected risks and fines, or even reputational damage. Innovative tools and queries as part of a thoroughly designed TCF can help companies stay on the safe side in the future. In many situations, risks such as bogus self-employment and incentives can be quickly and accurately identified using innovative tools and queries and directly allocated to risk categories to minimize – if not fully mitigate, negative outcomes.

Learn about the Federal Fiscal Court's landmark decision on third-party payments in insolvency proceedings, focusing on VAT debts under the German Insolvency Code. Key insights for businesses navigating insolvency challenges.