die  Mehrwertsteuer

B1

Estimated CEFR level.

/ˈmeːɐ̯veːɐ̯tˌʃtɔʏɐ/

💸 What Exactly is 'die Mehrwertsteuer'?

Die Mehrwertsteuer (often abbreviated as MwSt.) is an important tax in Germany and many other countries. It's an indirect tax levied on the sale of goods and services. The name derives from the fact that only the added value (Mehrwert) created at each stage of production or trade is taxed.

For consumers, it's usually visible as part of the final price (Bruttopreis - gross price). Businesses remit the collected Mehrwertsteuer to the tax office (Finanzamt), but can often offset the Mehrwertsteuer they paid themselves (Vorsteuer - input tax).

In Germany, there are mainly two rates:

• The standard rate (Regelsatz), currently 19%, for most goods and services.
• The reduced rate (ermäßigter Satz), currently 7%, for certain everyday necessities like food, books, or public transport.

🚨 Although often used synonymously in everyday language, the broader legal term in German tax law is actually die Umsatzsteuer (USt.), which translates to turnover tax. Die Mehrwertsteuer is the specific form of Umsatzsteuer that ultimately burdens the end consumer.

🧐 Grammar: A Look at Declension

The word "Mehrwertsteuer" is a feminine noun. Therefore, the article is "die". It is mostly used in the singular as it refers to a concept.

Declension (Singular)

A plural form ("die Mehrwertsteuern") is grammatically possible but very rare. It would refer to different types of value-added taxes (e.g., in different countries or historical rates).

Example Sentences

1. Der Preis versteht sich inklusive der gesetzlichen Mehrwertsteuer.
   (The price includes the statutory value-added tax.)
2. Wie hoch ist die Mehrwertsteuer auf Bücher in Deutschland?
   (How high is the value-added tax on books in Germany?)
3. Unternehmen können die gezahlte Vorsteuer von der abzuführenden Mehrwertsteuer abziehen.
   (Companies can deduct the input tax paid from the value-added tax to be remitted.)

🛒 When and How to Use 'Mehrwertsteuer'?

The term Mehrwertsteuer is used in various contexts:

• Everyday life: When shopping, you often see it itemized on the receipt (Kassenbon) or hear that prices are "inklusive Mehrwertsteuer" (including VAT).
• Business: Companies must calculate, declare, and remit the Mehrwertsteuer. It's a central part of accounting (Buchhaltung).
• Politics & Law: Discussions about the level of Mehrwertsteuer rates or changes to the turnover tax law (Umsatzsteuergesetz) are common political topics.

Distinction from Umsatzsteuer (USt.):
As mentioned, Umsatzsteuer (turnover tax) is the legally correct umbrella term. Mehrwertsteuer describes the system of how this tax is levied (taxing the added value at each stage) and is more commonly used in colloquial language, especially from the end consumer's perspective. On invoices or in legal texts, you'll more often find the term Umsatzsteuer or the abbreviation USt.

The abbreviation MwSt. is very common for Mehrwertsteuer.

🧠 Mnemonics for Mehrwertsteuer

Article Mnemonic: Think of the base word "Steuer" (tax). It's die Steuer. Therefore, it's also die Mehrwertsteuer. Many types of taxes in German are feminine (die Einkommensteuer - income tax, die Körperschaftsteuer - corporate tax).

Meaning Mnemonic: Imagine a chain: Raw material -> Manufacturer -> Retailer -> Customer. At each step, more value (Mehr Wert) is added to the product. And this *added value* is subject to a *tax* (Steuer) – the Mehrwertsteuer (Value Added Tax)!

🔄 Similar Terms: Synonyms & Antonyms

⚠️ Be careful with terms like Verbrauchssteuer (consumption tax). While VAT is a type of consumption tax, the term Verbrauchssteuer also includes other taxes (e.g., tobacco tax, coffee tax).

😂 A Little Tax Joke

Warum gehen Finanzbeamte nie in die Sonne?
Sie haben Angst vor der Steuererklärung im Freien – und davor, dass jemand sagt: "Schau mal, die Mehrwertsteuer scheint ja heute besonders hoch!" 😉

(Why do tax officials never go out in the sun?
They're afraid of outdoor tax returns – and of someone saying: "Look, the value-added tax seems particularly high today!")

📜 Poem About the Tax Burden

Auf Milch und Brot, auf Buch und Kleid,
liegt eine Last, macht Preise breit.
Sie heißt die Mehrwertsteuer, klar,
vom Staat genommen, Jahr für Jahr.
Mal sieben, mal neunzehn Prozent,
ein kleiner Teil, der schnell verbrennt.
Im Preis versteckt, für jeden Gast,
des Staates stete Einnahmelast.

(On milk and bread, on book and dress,
lies a burden, making prices express.
It's called the Value Added Tax, clear,
taken by the state, year after year.
Sometimes seven, sometimes nineteen percent,
a small part, quickly spent.
Hidden in the price, for every guest,
the state's constant revenue quest.)

❓ Riddle Time

Ich bin ein Aufschlag, fast überall,
auf Waren groß und auch im kleinen Stall.
Mal bin ich niedrig, mal recht hoch,
doch zahlen musst du mich dennoch.
Unternehmen führen mich ab ans Amt,
damit der Staatshaushalt nicht lahmt.

Wie heiße ich?

(I'm a surcharge, almost everywhere,
on goods large and in stalls small and bare.
Sometimes I am low, sometimes quite high,
but pay me you must, by and by.
Businesses remit me to the state's hand,
so the national budget stays grand.

What am I?)

(Solution: die Mehrwertsteuer / Value Added Tax / VAT)

🧩 Word Puzzle and More

Word Composition

The word "Mehrwertsteuer" is a compound noun, composed of three parts:

• Mehr: Means more or added.
• Wert: Refers to the economic value of a good or service.
• Steuer: Means tax.

Together, it describes a tax levied on the increase in value (the Mehrwert or added value) at each economic stage.

Trivia

Die Mehrwertsteuer is one of the most important sources of revenue for the German state budget. The system was introduced in Germany in 1968 and is based on European Union directives, which is why it exists in a similar form in all EU member states (usually called VAT - Value Added Tax).