Deutsche Post and DHL to pass on VAT reduction to customers

DHL Express has announced it is planning major infrastructure investments in the Americas region, of more than $360m between 2020 and 2022.

Deutsche Post and DHL are to pass on the temporary VAT reduction that forms part of the German government’s stimulus package to its customers, whereby value-added tax (VAT) in Germany will be reduced from 19% to 16% for the regular rate and from 7% to 5% for the reduced rate between July 1, 2020, to December 31, 2020.

The price of numerous domestic and international products and services will fall accordingly, impacting postal and parcel products such as Plusbriefe and Packset as well as the ExpressEasy product for private customers, which is available in selected retail outlets and via DHL’s online franking service. The VAT reduction will also apply to business-customer products which are subject to VAT, including letter mail communication, as well as parcel, dialogue marketing and Express products. The reduction in VAT will, however, have no impact on universal postal services such as individual letter mail items and parcels up to 10kg (without additional services). These products are categorised as universal postal services covering basic postal needs and as such are exempt from VAT by law.

Customers will be informed about the temporary price adjustments to postal services via posters in postal retail outlets. However, the most requested products in postal retail outlets are traditional universal postal services – and as such exempt from VAT. These products will not be subject to any change in price. In light of this, customers will not require to purchase top-up stamps following the introduction of the VAT reduction measure as it will not impact postage rates for these products.

Customers who frank their shipments will also remain unaffected by the VAT reduction as transport franking charges via IT franking and franking machine are always processed as a net charge, with VAT invoiced separately.

Source: DHL


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