Germany is known for some strange tax regulations. Also for the Christmas tree: There are four different tax rates.
Not all Christmas trees are the same
Buying a Christmas tree is not difficult: you think about whether you want a Nordmann fir or a blue spruce, where you buy them and where you finally put them in the room. However, things are different for the seller – because as easy as selling the fir tree sounds, the subsequent battle with the tax return is tough. Because in Germany there are different tax rates for Christmas trees.
Four different tax rates
If you choose a plastic tree, the regular VAT rate of 19 percent applies. However, if you choose a real Christmas tree, you will get away with a cheaper tax burden. However, it depends on where you buy your Christmas tree: If you buy it from a Christmas tree farm, a sales tax rate of 10.7 percent is due. If you buy the fir tree in a hardware store or garden center, the reduced tax rate applies and is reduced to seven percent. The tax authorities are even more generous when it comes to foresters who sell trees grown in nature – the sales tax rate is only 5.5 percent. It’s even cheaper if you buy from a small business owner – no VAT is due here.
Not all Easter eggs are the same
As the Taxpayers’ Association (BdSt) reports, the tax chaos is not just limited to the purchase of Christmas trees. Similar rules also apply when buying Easter eggs – because not all Easter eggs are the same. The VAT rate differs accordingly depending on whether the Easter egg purchased is a real chicken egg, where seven percent VAT is due, or a decorative egg, where 19 percent VAT is due. The two examples clearly illustrate the fundamental complexity of the German tax system, which is why the BdSt calls for the German tax system to be subjected to a fundamental inventory and to be simplified overall.
Editorial team finanzen.net