Marterbauer Rejects Reduction of Food Value-Added Tax

"Combating inflation is one of the most important goals of this government. At the same time, we must continue the strict execution of the budget to rehabilitate the state budget," said the office of Finance Minister Markus Marterbauer (SPÖ) on Monday to the APA. A reduction in value-added tax is therefore "not affordable".

Wifo Director for Reduction of Food Value-Added Tax

Finance State Secretary Barbara Eibinger-Miedl (ÖVP) also referred to the state budget. "I mentioned the reduction of the value-added tax on food in the summer as a possible option, but at the same time pointed out the challenging budgetary situation," Eibinger-Miedl stated in response to an APA inquiry.

Specifically, Felbermayr proposed again on Sunday during the ORF press hour to relieve citizens by reducing the reduced tax rate from ten to five percent. He referred to other EU countries with low tax rates on food, such as Italy or Germany. "I believe that we actually have a high value-added tax rate on food in Austria," said Felbermayr.

Reduction of Food Value-Added Tax: Inflation Risk

However, Felbermayr also spoke of a risk that with a reduction in value-added tax on reduced goods, there could be a surcharge on the higher standard tax rate in return. This would drive inflation higher.

The office of Marterbauer argued similarly: "If the value-added tax were halved for some products and increased for others in return, this would have no positive effects on inflation." The measures currently taken by the government, such as the EU-wide fight against the Austria surcharge or a ban on shrinkflation, must now be implemented "swiftly".

FPÖ Criticizes Marterbauer

Sharp criticism of Marterbauer came from the Freedom Party. That the SPÖ Finance Minister warns of "counter-financing" is "economically absurd and socially cynical," criticized FPÖ economic spokesperson Barbara Kolm according to a release. "Value-added taxes are revenues of the Finance Minister, who has historical highs in tax revenues and still does not find sufficiency," said Kolm.

(APA/Red)

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