Restaurant in Austria

Special VAT Relief Mainly for the Hospitality Sector in Austria

By Manfred Leitinger and Antonio Lukic, Prodinger Leitinger & Partner

On 30 June, the Austrian Parliament aimed to pass a new law reducing the VAT rate to 5%. It was meant to affect all revenues generated from selling beverages and meals, meaning firms with a hospitality trade license. But only one day before the law came into effect, the parliamentary session turned out to also grant tax reliefs to the entire hotel industry, including the supply of accommodation.

In fact, it first seemed like all firms with a certificate of competence would have to apply the newly passed law, but it turned out every trade license holder, regardless of having possession of the certificate, is affected (including mountain huts, etc.). This relief was meant to include all consumptions on-site and deliveries to customers. However, also included are such sales associated to artists, cinemas, theatres, and even ebooks, for instance, also benefit from the new tax rate. Our lawmakers included all businesses, regardless of the legal form, thus all societies can effectively increase their net earnings while charging the same price to their customers.

Though the publication of the federal law gazzette took place on 07 July, the reduced tax rate had to be applied effective from the beginning of July and will last until the end of the year. As a consequence, we asked ourselves: What do we do with all the invoices issued at the beginning of the month? Fortunately, our Ministry of Finance found a typically Austrian solution for (yes, you are guessing right) typically Austrian problems; all companies concerned with the problem of not having enough time to set their invoicing up to the new VAT rate have the opportunity to correct it manually – either with a VAT correction stamp directly on the invoice or by correcting it with added text saying that the VAT was reduced to 5%.

This particular VAT relief is only one, and hopefully not the last, of a package of supports from the Austrian Government, to reduce the impact COVID-19 has on the economy and to get back on track as fast as possible.


Manfred Leitinger

Manfred Leitinger

GGI member firm
Prodinger Leitinger & Partner Steuerberatung GmbH & Co KG
Finance, Fiduciary & Estate Planning, Tax
Salzburg, Austria
T: +43 662 90 20 20
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Prodinger Leitinger & Partner Steuerberatung GmbH & Co KG has been a leading partner for medium-sized companies for more than 50 years. It is an independent competence centre with a strong network offering a wide range of services for every kind of project, requirement and undertaking. The Prodinger Group has 10 offices in Austria. It provides extensive advice on Austrian tax issues.

Manfred Leitinger is an expert who specialises in VAT consulting (for crossborder business and foreign companies in Austria) and accounting. He has broken new ground in the field of accounting through the use of modern technology; he uses existing data in adjoining programmes and optimises operational procedures.
Antonio Lukic

Antonio Lukic

GGI member firm
Prodinger Leitinger & Partner Steuerberatung GmbH & Co KG
Finance, Fiduciary & Estate Planning, Tax
Salzburg, Austria
T: +43 662 90 20 20
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W: prodinger.at

Antonio Lukic is a law graduate working for Prodinger Leitinger. He conducted plenty of employee assessments as a freelancer before taking on a tax candidate positon. For his diploma thesis on the Taxation of Initial Coin Offerings, he was awarded with the Styrian Chamber of Consultants Research Award 2019.


Published: Indirect Taxes Newsletter, No. 11 Autumn 2020 l Photo: Кирилл Рыжов - stock.adobe.com

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