In Brief: A six-month-long VAT cut could drop consumer prices in a bid to stimulate Germany’s economy

The reduction is part of a 130 billion euro stimulus package to boost the country’s economy.

Photo by: Skitterphoto, Pexels

By Soraya Sarhaddi Nelson and William Glucroft

Both houses of the federal parliament yesterday approved a half-year-long cut to Germany’s value-added tax, or VAT, a move that could also lower consumer prices.

Starting tomorrow, the regular VAT will drop to 16% from 19%. And the reduced rate VAT that applies to limited goods and services will drop from 7% to 5%.

Lowering the tax is part of a 130 billion euro stimulus package for Germany’s economy, which has been ravaged by the pandemic.

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Berlin is imposing new restrictions on people arriving here from coronavirus hot spots in Germany.

The Berlin Senate is ordering people from locked down regions like Gütersloh in North Rhine-Westphalia to show proof they tested negative for COVID-19 within the previous 48 hours. Those who can’t will have to self-quarantine for two weeks.

A similar, negative test requirement has been imposed by Austria on Gütersloh residents who travel to the alpine country.

Austrian Health Minister Rudolf Anschober told public broadcaster ORF on Sunday night that his government’s travel rules match Germany’s and that the countries are coordinating with each other.

Such targeted testing and quarantines are designed to keep the pandemic under control within the EU to prevent the need for wide scale lockdowns or border closures.

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A Polish presidential runoff is expected next month after incumbent Andrzej Duda apparently failed this past Sunday to secure an outright win.

The election was originally scheduled for May 10, but was delayed until June 28 because of political and legal battles over whether the vote should be held because of the pandemic.

First round results showed Duda, who is backed by the ruling Law and Justice Party, with roughly 43.5% of the vote. He needs at least 50% to avoid a runoff with Warsaw’s centrist mayor on July 12.

Polish opinion polls indicate a win by Duda isn’t certain given many opposition voters are expected to unite against him.

The Polish electoral commission said it will release the final results by Wednesday evening.

This news is brought to you in cooperation with Berliner Rundfunk.

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