Temporary reduction of value added tax in Germany

(The temporary reduction of value added tax is only valid for customers based in Germany!)

At the beginning of June 2020, the German government decided to reduce the German VAT rate for products/services for the period from 1 July to 31 December 2020 in order to strengthen domestic demand. 

Accordingly, the standard rate of VAT will be reduced from 19% to 16% and the reduced rate from 7% to 5% from 1 July 2020 to 31 December 2020 for German customers. 

After reviewing the regulations and discussions with tax specialists as well as with the Börsenverein and retailing partners, we at Springer Nature have decided on the following handling.

Does Springer Nature pass on the reduction in value added tax?

There will be no pricing adjustments for books (incl. eBooks), which are subject to the German fixed book price system, as well as for English language books (incl. eBooks).

This is in line with the wishes of the Barsortiment and retailers, supports all parties involved in the sale of our products and also avoids additional expenses, e.g. through new price labelling of books already in circulation. 

Outside the Books division, the advantage resulting from the temporary reduction in value-added tax will be passed on, insofar as the contractual and value-added tax regulations permit a corresponding price reduction. 

We refer here in particular to the special features of magazine subscriptions.

How are returns handled?

Returns, i.e. the return of already delivered books, represent a cancellation of the original delivery. Thus returns to Springer Nature are considered with the same VAT rate as the original delivery.

Which VAT rate applies to book orders in the period of July 1 until December 31, 2020?

When ordering single books or journals, for example, via www.springer.com, the time of delivery is decisive for the determination of the VAT rate.

If a book or journal is delivered between 1 July and 31 December 2020, these deliveries are subject to 5% reduced VAT.

For the purchase of individual electronic books and electronic journals, the rules described above apply accordingly.

How is the VAT rate for journal subscriptions determined?

Journal subscriptions are considered to be so-called permanent benefits, as they are not time-related, but extend over a longer (e.g. 6 months, 1 year, 1 calendar year) or unlimited period of time. 

The last day of the agreed performance period is decisive for determining the applicable tax rate for permanent benefits. If partial services are agreed and invoiced (e.g. per calendar year in the case of a multi-year contract), the last day of the agreed partial service period is relevant for determining the applicable VAT rate.

In the case of journal subscriptions, the agreed end date of the subscription is therefore the relevant key date for determining the applicable VAT rate.

This applies to both electronic and printed journal subscriptions.

If the subscription ends on 1 January 2021 or later, 7% VAT is payable for the entire subscription period. 

However, if the subscription ends after 30 June 2020 and before 31 December 2020, 5% VAT will be charged (applies only for subscriptions invoiced after 1st. of July 2020) . 


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