Higher gas price in April due to rising VAT

From April onwards, the regular VAT rate of 19 percent will apply to gas prices again. Over the course of a year, consumers can then face additional costs of several hundred euros.

Consumers will have to prepare for higher gas prices from April. With the return to the full VAT rate of 19 percent on April 1st, an average increase of eleven percent can be expected, the comparison portal Verivox announced this morning. This corresponds to an additional burden of 220 euros per year for a model family, and for basic care it is even 291 euros.

To ease the burden on households due to high energy prices, the VAT on gas has been seven percent since October 2022. A model family with an annual gas consumption of around 20,000 kilowatt hours was saved an average of 426 euros. The measure is now expiring.

According to Verivox calculations, the average gas price for households is currently 9.8 cents per kilowatt hour. With the higher VAT rate it is 10.9 cents.

No Special right of termination

As a result of the change, customers have “no special legal right to cancel, so they should check their contract as early as possible and look for the cheapest possible tariff,” advised Verivox. Compared to the cheap gas tariffs, the basic supply is “currently twice as expensive on average”.

Kerstin Andreae, General Manager of the Federal Association of Energy and Water Industries, said: “The temporary reduction in VAT on gas and heat was an important instrument during the energy crisis to relieve the burden on consumers.” However, thanks to the recent fall in energy prices, it is justifiable to now allow this relief instrument to expire.

VAT reduction costs the state billions

The reduction in VAT was limited from the outset until March 31, 2024. A growth law passed by the Bundestag stipulated that the VAT reduction was to expire at the end of February – because the “crisis-related price peaks” on the gas markets had now subsided, as reported Justification was called. After a mediation process between the Bundestag and Bundesrat on the law, it was decided that the VAT reduction would not expire until the end of March.

The measure is expected to have cost the state billions. Finance Minister Christian Lindner (FDP) had therefore pushed for the full tax to be raised again at the turn of the year. According to a spokesman for the Ministry of Finance, these three months alone would have meant a mathematical plus of 2.1 billion euros for the state.