We pass 100% of the VAT reduction on to you

We pass 100% of the VAT reduction on to you

VAT reduction:

Between the 1st of July and the 31st of December 2020, the value added tax (VAT) in Germany will be temporarily reduced. This measure is part of an economic-growth package aimed to reduce the economic impact of the Corona pandemic. We will pass this VAT reduction from 19% to 16% on to you in form of a discount on your WeWash invoice.

Questions and answers
regarding the VAT reduction at WeWash

We will pass this VAT reduction on to you in form of a discount. This means that both in the app and on the posters in the laundry room, the original gross prices, without the discount, will remain. The discount is shown separately on the invoice (see picture). The discounted total invoice amount will be deducted from your registered payment method.

VAT Reduction Discount

With our approach, we want to prevent unnecessary additional costs, e.g. for the production of new price lists for the laundry rooms, which would offset part of the VAT reduction. Our aim is not to benefit from this political measure aimed at boosting consumption, but to pass the reduction on to you in full and in a very transparent way.

We pass the sales tax reduction on to you as a 2.52% discount. The reduction from 19% to 16% does not correspond to a discount of three percent. Why? We’ll explain that to you below.

The price you see in the app and on the laundry room poster is the gross price. It includes 19% VAT. The VAT is calculated from the net price of the washing or drying cycle. You can also find it on your invoice (see picture). The net price, which was previously taxed at the rate of 19%, will now (starting on the 1st of July 2020) be taxed at the rate of 16%. This means that the VAT reduction will affect the gross price with 2.52%, not with three percent.

For example

Let’s assume a net price of €1.
So far, the gross price, including the 19% VAT, was €1.19.
With the VAT reduction to 16% the new gross price is €1.16.
The difference between the previous and the new gross price is €0.03. That equals a discount of 2.52% on the previous gross price.

There are two ways how to calculate the discount

  1. Gross price x 2.52 divided by 100
    The result is the discount.
  2. Net price x 16 divided by 100
    The result of this calculation is the new VAT amount. Deduct this amount from the old VAT amount. The result is the discount.

VAT Reduction Net Price

The discount will apply until the increase of the VAT on the 1st of January 2021.

Do you have further questions? Please don’t hesitate to contact us at support@we-wash.com.