Tax authorities (!) deny saunas a therapeutic purpose - decree comes into force on July 1, 2015
In Germany, it's no wonder what decisions are made by the federal and state finance ministries. Saunas are now being reinterpreted - at least in terms of tax law. While sweating in the sauna was previously considered a health measure or prevention, it will become a wellness pleasure from July 2015. For sauna operators in Germany, this means that they will have to pay the full VAT rate of 19 percent in future. But how?
The tax officials are supposedly well aware that sunbeds are harmful to health and that sauna treatments are for pleasure rather than health. Not to mention the fact that many experts and doctors have opposing views on this: Since when and why have the tax authorities in Germany been deciding what is a cure and what is not?
German spas are in trouble
"Around 50 percent of public sauna spas in Germany could find their existence threatened by the increase in the tax rate from the previous seven percent to 19 percent," explains Dr. Christian Ochsenbauer, Managing Director of the German Society for the Bathing Industry (DGfdB).
You only have to look around the swimming pools to see how dilapidated they are in many places. Opening hours are often so severely restricted for reasons of operating and heating costs that visitors sometimes only have very limited opportunities to use them. Is there really room for a 12% increase in sales tax? How many of the customers who are looking to relax and actively do something for their health are prepared to bear these additional costs with significantly higher admission prices?
Public pools and saunas still receive support from cities. Private thermal baths, pools and saunas and, of course, fitness studios do not have this financial leeway. They can only pass on the additional costs to their customers and make savings elsewhere, possibly even laying off employees!
The industry associations fear losses in the millions and are currently fighting against the tax increase planned by the federal and state governments. With the help of signature campaigns, they want to achieve a revision of theValue Added Tax Act.
Value Added Tax Act & Therapeutic Products Guidelines
The background is as follows: According to Section 12 (2) no. 9 sentence 1 UstG, the tax is reduced for spas that serve to protect health or treat an illness. Until now, the exact therapeutic purpose did not have to be proven, nor was a doctor's prescription required. This will change significantly next summer. The current version of the so-called Therapeutic Products Guidelines (HeilM-RL), which are issued by the Federal Joint Committee on the prescription of therapeutic products in statutory health care, will then regulate whether a therapeutic spa measure may be taxed at a reduced rate of seven percent.
However, it is still not necessary for the reduced tax rate to actually have a doctor's prescription. The decisive factor in future will therefore be that the administration of the spa treatment can be prescribed as a therapeutic product in accordance with this directive.
Does that sound contradictory to you? For us too. So let's try to shed some light on the regulatory jungle.
What is prescribable?
Spa visits that are "generally prescribable" should continue to be tax-privileged at seven percent.
Confusion, disputes and legal loopholes are inevitable. If you read the list provided by the Federal Ministry of Finance (BMF), you will unfortunately find that all ambiguities have been completely eliminated. According to the BMF, the following facilities and measures will soon no longer be prescribable:
- Measures whose therapeutic benefit has not been proven in accordance with the procedural regulations of the Federal Joint Committee (VerfO), e.g. cave/spelaeotherapy, non-invasive magnetic field therapy, foot reflexology, acupuncture massage and Atlas therapy according to Arlen;
- Measures that can be assigned to personal
- lifestyle, e.g:
- Full-body massages, massages using equipment, underwater massages using automatic jets, provided they are not therapeutic massages
- Partial and tub baths, unless they can be prescribed according to the specifications of the catalog of remedies
- Sauna, Roman-Irish and Russian-Roman baths
- Swimming and bathing, also in thermal and warm water baths - however, a reduction in accordance with § 12 Para. 2 No. 9 Sentence 1 Alternative 1 UStG is possible here;
- Measures that serve to change the shape of the body (e.g. bodybuilding) or fitness training
- Furthermore, so-called floating baths, hay baths, chocolate baths, kleoate baths, aroma baths, seawater baths, light treatments, Garshan and Reiki are not medicinal baths.
Source: www.bundesfinanzministerium.de
After reading this section of the "Amendment to Section 12.11 of the Value Added Tax Application Decree", which is decisive for the allocation of the VAT rate, can you see through which standards the BMF applies where?
Unfortunately, neither can we. This is where common sense comes to a halt at the latest. On the one hand, the Ministry of Finance's list explicitly refers to non-prescription treatment methods and then, on the other hand, abstruse exceptions are listed. On the one hand, the treatise is meticulous, but on the other, those involved forget the essentials.
Sweating is healthy
Active health promotion and relaxation - after all, that's what saunas are all about. It is undisputed that regular sauna sessions have a positive effect on the immune system, the heart and circulation as well as general well-being and the skin.
"There are many reasons to seek a balance to an often hectic and unhealthy lifestyle. Baths, saunas and spas are far more than just bare figures in terms of cost and energy efficiency. They play a major role in the physical and mental health of many," says Ulrich Kormer, Managing Director of Messe Stuttgart, host of interbad.
It also seems misleading that all forms of sauna are generally denied a healing character. In the case of baths, however, a further distinction is made between Roman-Irish and Russian-Roman or hay and chocolate baths. You have to read very carefully - and in the end you still don't understand the meaning and purpose of this decree.
Tina Klostermeier
Source: F&G
Published on: 23 February 2015