VAT forms provide patrons thousands in savings across Germany

By Mark HeeterSeptember 28, 2022

(Photo Credit: U.S. Army) VIEW ORIGINAL

The cost of a Value Added Tax form in Germany will increase Oct. 1, from $7 to $10 for purchases under $2,500, and from $90 to $100 for purchases over $2,500.

“The VAT program is one of the most popular and widely used MWR services, and prior to an earlier increase this past April, we had not raised the price of these forms in eight years,” said Jeff Wertz, IMCOM-Europe Assistant Chief of Staff for Morale, Welfare and Recreation.

By using MWR-provided VAT Forms at German vendors from corner stores to car dealerships, eligible patrons can easily save hundreds or thousands of dollars by paying a fee that covers the cost of producing the forms.

“After many years of keeping prices at a very low level, we are at a point where we must adjust our fees to retain the ability to provide quality services to our members,” Wertz said. The VAT program is not supported by taxpayer or other government funding; the program must be self-sufficient financially in order to continue to provide the service.

In a typical year prior to the COVID-19 pandemic, IMCOM-Europe garrisons issued roughly 300,000 VAT forms, used for an average savings of €57 on the average purchase price of €300, according to Rafael Wunsch, business consultant for IMCOM-Europe.

Additionally, for the larger scale purchases of €2,500 and more, the average purchase price ranges from €12,000 to €25,000, resulting in significant savings to the individual, €2,280 to €4,750 in tax avoidance, he added.

“Many local stores even permit collecting or combining of receipts within one month, resulting in even greater savings to an individual at a very small cost,” Wertz said.

As the proponent for the VAT programs across military installations in Germany, IMCOM-Europe noted that these new fees will also take effect at Air Force installations, according to Wunsch.

There is a cost associated with issuing the forms, controlling them, maintaining the records and ensuring they are properly used. Over the past several years, IMCOM-Europe has been able to offset some of the costs by introducing efficiencies in these systems of producing and controlling the VAT forms, but this year increases have been necessary due to rising costs, according to Wertz.

“When viewed through the lens of the hundreds or thousands of euros that these forms afford them in savings, they offer our patrons a good deal for tremendous savings,” he said.

VAT forms still provide value for customers, especially in today’s economy, where prices are rising for many goods and services.

For instance, using a $1 to €1 exchange rate, for a:

€100 item: 19% VAT = €19 - $10 for the form = €9 savings

€1,000 item: 19% VAT = €190 - $10 for the form = €180 savings

€2,500 item: 19% VAT = €475 - $100 for the form = €375 in savings

€15,000 item: $19% VAT = €2,850 - $100 for the form = €2,750 savings