Chair of Strategy and Marketing

Quotations of Prof. Dr. Martin Fassnacht at Stern.de

On late Wednesday, the German government announced measures aimed at boosting consumer demand.

One of the most unexpected elements of the adopted package is the reduction of the value-added tax rate by three percentage points designed to soften the blow of what is likely to be the worst recession in Germany’s postwar history. From July 1 until the end of 2020, the standard rate of VAT will be reduced from 19 to 16 per cent, and the lower band cut from 7 to 5 per cent — a measure that will cost €20bn. Will this move have the desired effect, and will consumers now be able to buy at lower price? Stern.de asked Professor Dr. Martin Fassnacht to comment on this topic.

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