The sales tax is a final consumer tax. Entrepreneurs are obliged to add sales tax to their goods and services. In principle, sales tax is only paid by the person who is the last to purchase a product or service. This is why this is an indirect tax, as it is collected from the end consumer or consumer. For this reason, all prices in the supermarket are automatically gross, as they already include this tax. In this case, one also speaks of value added tax, because it taxes the value added that is created through the manufacture and sale of a product or service.

The final price of a product or service always includes sales tax

What the company then receives as sales tax via the end consumer must be paid to the tax office afterwards. The tax can be paid to the tax office monthly, quarterly or annually. It depends on how much sales the company generates. The company does not experience any loss of income as a result of the tax because the tax is added to the net amount of the goods.

Sales tax amount

The sales tax law knows three different tax rates:

  • The standard tax rate of 19% is the most common.
  • There is also a reduced tax rate of 7%. It is intended to relieve the end consumer of certain sales.
  • Some companies are allowed to use a third variant of sales tax – the average tax rate.
  • The sales tax law differentiates between three different tax rates: the standard tax rate (19%), the reduced tax rate (7%), the average tax rate.
  • Incidentally, the tax is levied according to 1 UStG (Value Added Tax Act) on all sales in connection with the import of goods, the export of goods and domestic sales.

Which tax rate applies essentially depends on the type of service. In some cases, the regulation appears arbitrary: for example, the standard tax rate of 19% is applied to beverages. However, milk is taxed at 7%. Although the reduced tax rate should apply to basic foodstuffs, mineral water is also taxed at 19%. For online tax filing this is important.

VAT calculator

The amount of the sales tax must be taken into account when calculating. Our calculators can be used to quickly and easily determine how sales tax affects the gross price of goods or services.

Entrepreneurs as tax debtors are obliged to declare the amount of sales tax to the tax office and to pay it. Therefore, every entrepreneur who carries out a commercial or professional activity must regularly submit an advance VAT return to the tax office.

Companies that are newly established and are not classified as small businesses are obliged to submit the pre-registration every month. This obligation applies to the first year of commencement of the activity and the following year. In addition, a VAT return must be submitted at the end of the year .