Germany to restrict tax reclaim for foreign shoppers

Business

BERLIN (AP) — The German government plans to stop non-European Union citizens from reclaiming value-added tax on purchases below 50 euros ($56), a move aimed largely at reducing congestion on the border with Switzerland.

People who aren’t citizens of the 28-nation EU can reclaim VAT — which is charged at 19% on most goods in Germany — at customs posts when they produce an export receipt issued by a store.

That often leads to congestion in areas close to the border with Switzerland, which isn’t in the EU, and queues at the German-Swiss border. Many people from Switzerland, where prices tend to be relatively high, often shop in Germany.

News agency dpa reported that the Cabinet’s decision Wednesday, which needs parliamentary approval, aims to reduce pressure on customs and ease traffic problems.

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