Austrian Finance Minister Markus Martterbauer rejects the proposals to reduce value added tax. One of the most important tasks of the government is the fight against inflation. At the same time it is necessary to continue In the strict performance of the budget and to heal public finances, The Ministry of Finance said on Monday. TASR informs this based on the APA report.
- The Austrian Finance Minister rejected a proposal to reduce VAT.
- The initial government’s priority is the fight against inflation and the recovery of finance.
- Food VAT reduction was proposed by economist Gabriel Felbermayr.
- The Ministry of Finance warned against increasing inflation due to VAT reduction.
- The current discounted VAT rate in Austria is 10 %.
Gabriel Felbermayr, director of the Austrian Institute for Economic Research, spoke with the proposal to reduce the discounted VAT rate from the current 10 % to 5 %. “I believe that in Austria we actually have a high grocery VAT rate,” said Felbermayr.
However, there is a risk that a reduction in VAT to goods with a discounted rate could lead to a surcharge to a higher standard rate, And that would increase the inflation even further, the economist pointed out. The Ministry of Finance argues similarly. “If the VAT for some products were to be halved and increased for others, it would have no positive effect on inflation,” stated the Ministry in a statement.
