← BlogDecember 8, 20235 min readEditorial teamDEUAENRU
For businesses
VAT in hospitality 2024: what it means for your staff costs
On December 31, 2023 the reduced 7% VAT rate on food in German hospitality expires. Without an extension, 19% applies again from January 1, 2024. Those who calculate now stay in control.
What changes
Since the pandemic relief, food in restaurants has been taxed at a reduced 7%. This is limited to the end of 2023. As of today no extension exists, so plan with 19% from January. Drinks are taxed at 19% anyway.
Why this is also a staffing question
If prices for guests rise or margins fall, rosters and staff costs come under pressure. At the same time the minimum wage rises to €12.41 on January 1, 2024. Both together call for clean calculation.
How to proceed
- Review the menu: which dishes still earn their contribution margin at 19%?
- Recalculate staffing needs: map peak hours precisely instead of staffing flat.
- Use flexible models: seasonal staff, temporary agency work or a contract for work (Werkvertrag) for clearly defined tasks — you pay only for actual demand.
- Adjust contracts: discuss prices and hourly rates with service providers early.
Mistakes to avoid
- Cutting staff across the board: if service suffers, revenue drops.
- Hoping for a last-minute change in the law without a fallback plan.
- Forgetting the minimum-wage increase in your calculation.
Conclusion
Plan 2024 with 19% VAT and a €12.41 minimum wage. Flexible staffing keeps cost and quality in balance.
FAQ
Will 7% apply in 2024?
As of December 8, 2023 no extension has been decided; plan with 19%.
Does this affect drinks?
Drinks are already taxed at 19%.
What is the minimum wage in 2024?
€12.41 per hour from January 1, 2024.
How can I keep staff costs flexible?
With seasonal staff, temp agency work or a contract for work for clearly defined services.
