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German Covid Tax Reduction

Hi Guys,
as a small developer who has a hard time financing the project over the years I want to bring your attention today to the tax reductions the German government has introduced in order to facilitate some of the Covid-19 related hardships.

The billing from my German webhosting company has deducted 3 percent of taxes, and explains it as follows.

English article, Germany: VAT rate reduced from 19 to 16 percent and tax rate will drop from 7 to 5 percent between July 1 and Dec 31, 2020. German VAT Germany: VAT rate reduced from 19 to 16 percent and tax rate will drop from 7 to 5 percent between July 1 and Dec 31, 2020. German VAT

Since Epic Games has setup pricing for European customers to be the US value, just in Euros, including taxation, which would be 19 percent for German users, I wonder if we can expect the 3 percent adjustment the German government has omitted for 2020? If you could take a look into this, that would be great, thank you.

Well epic pays VAT for you. If your asset price is for example 30$ and that would be 25,44€ atm then epic puts the missing 16% on top of that so the price in the marketplace is 29,51€, so it won’t show up in any of the sales stats cause it doesn’t affect you. Of course it is debatable if epic should give the 3% or a part of it to the creator or withhold it cause it is paying the tax anyway. The thing is that you aren’t selling to the customers directly, you are selling to epic and epic is selling to them.

I’m not sure if this clears anything up actually :rolleyes:

If you buy assets on the market, the price you pay includes VAT.

Or so you’re told; the invoice you receive contains no VAT information so you don’t actually know what the base price was, nor what the VAT paid was. It’s a common complaint, because it makes it impossible to deal with tax returns and audits.