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Germany Advances Toward Mandatory Digital Payments as Cards Surpass Cash

Policymakers target tax fraud by planning a legal duty for restaurants to offer a digital payment option.

Overview

  • Germany’s Bundesrat, on a motion from Lower Saxony and Hamburg, backed a resolution tied to the 2025 tax amendment that would require digital payment acceptance in the gastronomy sector.
  • The incoming coalition agreement promises choice between cash and at least one digital method and sets a cash‑register obligation for businesses with more than €100,000 in annual turnover starting January 1, 2027.
  • A new Allensbach survey finds 47% paid their last purchase by card versus 41% with cash, with mobile and contactless use rising sharply among under‑30s.
  • Industry groups warn of added costs, while the tax officials’ union argues broader digital payments would lift revenues; public polls show sizable support for a legal acceptance duty, especially among younger people.
  • A reported relief measure under discussion would cut VAT on food to 7% from 2026, excluding drinks, as privacy debates intensify over machine reading of banknote serial numbers that can trace cash flows.