GERMANY: Covid-19 VAT reductions passed on to consumers!
A recent ifo study showed that the temporary VAT cuts in Germany due to covid were indeed passed on to the final retail prices. As mentioned in our previous articles, on July 1st 2020 the German government took measures in order to help local businesses and reduce the overall economic consequences of the pandemic. The ifo institute web-scraped the prices of around 190.000 products and found out that the reduction of the VAT did pass through to the retails prices. As a result a 2% reduction in prices of German supermarkets was documented and a decrease of a bigger scale took place in more competitive product markets.
Source: VATupdates.com / ifo.de