Reduction of the Value Added Tax in Germany – This is What You Need to Know
Summary: For the period from July 1 to December 31, 2020, the Value-Added Tax in Germany is reduced from 19 % to 16 %. We at Boxcryptor will donate the amount saved.
On 12 June 2020, an economic stimulus package worth billions of euros was presented, with which the Federal Government intends to boost the weakened German economy. This is intended to mitigate the negative economic impact of the Corona crisis. An important component of this package is a sales tax reduction. This measure is intended to ease the burden on consumers and the retail trade.
We welcome this measure, but as a medium-sized software company we do not see ourselves as the focus. Our billing systems are not designed to account for short-term changes. For this reason, we have decided to donate the additional revenue every month.
Background information: Our pricing information on the website is designed to ensure that licenses aimed at companies are priced at net prices. The licenses we sell to private individuals are marked with gross prices. The VAT for individuals is only shown during the purchase process when it is clear in which country the software will be invoiced for the purchase.
Why does Boxcryptor not pass the savings on to customers?
For us as an internationally operating company, the reduction in VAT only affects a small proportion of our customers, i.e. private users of our encryption software resident in Germany. A price conversion for such a small group would be a disproportionate effort for us. In addition, we offer our software as a subscription, so payment per license is due either annually or every three years. Passing on savings fairly to everyone who took out a subscription is not possible with a price change that only lasts for 6 months.
Lastly, the amount of reduction we could pass on to our users is also a factor for us. Using our most popular license Boxcryptor Personal with an annual cost of 36.00 € as an example, the price reduction would be 0.78 €. We therefore take the liberty of maintaining the prices.
What does Boxcryptor do with the additional revenue?
So, in the next 6 months we will pay a little less VAT to the tax office. The difference (e.g. 0.78 € for the sale of each Boxcryptor Personal license) will be calculated monthly and rounded up. The accumulated sum will be donated. We will select organizations that are involved in the management of the Corona crisis in Germany.
If you would like to suggest an organization that helps deal with the effects of the Corona crisis in Germany, please contact us by sending an e-mail to firstname.lastname@example.org.
Donation 1: Stiftung Bildung
The additional income from the month of July goes to the Stiftung Bildung. We are pleased to transfer 2000.00 € to the charitable institution.
The Stiftung Bildung supports kindergarten and school development associations throughout Germany with a Corona protective screen. The purpose of the foundation is to provide good educational opportunities for children and young people who live in challenging circumstances. Find out more about the measures supported by the foundation here.
Donation 2: Tür an Tür
The additional income from the month of August goes to “Tür an Tür”. We are pleased to transfer 2000.00 € to the charitable institution.
“Tür an Tür – miteinander wohnen und leben e.V.” campaigns for the strengthening of rights and chances of immigrants since 1992. The association, which is based in Augsburg, Bavaria, offers migration counseling, trainings, and provides networking services. Inform yourself here about the work of “Tür an Tür”.
Donation 3: Teach First Deutschland
The additional income from the month of September goes to Teach First Deutschland. We are pleased to transfer 1500.00 € to the charitable institution.
In Germany, your origin still plays a decisive role in educational success. Teach First Deutschland is a non-profit educational organization showing that all teenagers can be successful, regardless of their income and social background. The Organization has deployed committed university graduates from various fields of study as “Fellows” nationwide at schools in difficult environments for over 10 years.
The Corona Pandemic has led to a digitalization push in the German school system and is also a focal point that aggravates the situation of students who already had difficulties keeping up with the pace in everyday school life. Therefore, Teach First Deutschland is now more committed than ever to ensure all children and teenagers can benefit from digitalization and that Fellows in the school system provide incentives for how school organization and teaching can be shaped.
Digifellows know the living conditions of children from financially weak families and are committed to helping students: We study and live increasingly digitally. To be able to deal with this and be prepared for the digital working world, students must be able to use and design media in a creative and reflective manner. The Digifellows have the mission of strengthening the media competence of students.
Donation 4: Tafel Augsburg e.V.
The additional income from the month of October goes to “Tafel Augsburg”. We are pleased to transfer 1500.00 € to the charitable institution.
Tafel Augsburg e.V. is one of over 900 distribution points in Germany where food is distributed to people in need. The Tafel collect surplus food from supermarkets and restaurants and passes it on. The organisation relies on the help of many volunteers and is financed by donations. You can find the website of Tafel Augsburg e.V. here.
Donation 5: 2 LTE Routers for Schools in Augsburg
With the additional income from the month of November, we will buy two LTE routers and two data cards for two years to make digitization easier for teachers and students in Augsburg. We are thus joining a group of 5 other Augsburg companies that are providing a total of 18 routers. We would like to thank the IHK Schwaben for organizing this urgently needed donation campaign.
Donation 6: 8 sponsorships for digital learning
From the additional income from the month of December we donate 8x250€ as sponsorship for digital learning. The support for pupils is arranged by the Deutsches Kinderhilfswerk. The organization has been working for a child-friendly Germany for more than 45 years. The focus of its work is on children's rights and on improving the lives of disadvantaged children. You can find the website of the Deutsches Kinderhilfswerk here