1. Introduction & Problem Statement
Germany has had a structural competitive disadvantage in the European context for years: unlike many neighbouring EU member states, Germany collects import VAT (EUSt) immediately at the point of importation – before the input tax deduction can be claimed. For businesses that regularly import goods from third countries, this means tied-up liquidity, administrative burden, and the need to coordinate two separate authorities – customs administration and the tax office. The BMF is now moving to address this issue.
2. How Does the Current System Work?
Import VAT is assessed and collected at the time of importation from non-EU countries, applying customs regulations by analogy. Businesses must first pay the assessed amount to the customs authority – either within 10 days of the customs debt notification, or, using a deferred payment account, by the 26th of the month after next (the so-called Fristenlösung under § 21(3a) UStG). Only thereafter can VAT-entitled businesses claim the paid import VAT as an input tax deduction in their monthly or quarterly VAT return. Direct offsetting is currently only achievable with considerable effort, as it requires involvement of both the competent state authority (Finanzamt) and the federal authority (customs administration).
3. The BMF Proposal: The Offsetting Model
On 5 June 2026, the BMF published key points for a new offsetting model, which was discussed with affected associations on 11 June 2026. The core idea: for a verified, input-tax-entitled group of businesses, only the tax base and the applicable rate for import VAT would be determined at importation. This data would be automatically transmitted to the relevant state tax authorities and reflected in the VAT return – simultaneously as a payment obligation and as a deductible input tax amount. Ideally, this results in a net-zero position: businesses would no longer be required to make an immediate payment at the point of importation.
4. What Changes Specifically for Businesses?
For VAT-entitled importers, the offsetting model would represent a significant liquidity advantage: the cash flow disadvantage from the upfront import VAT payment would be eliminated. In addition, the BMF is considering abolishing § 21(3a) UStG and realigning the due date for import VAT when using a deferred payment account with the due date for customs duties – i.e., the 16th of the month following importation. Participation in the offsetting model is intended to remain voluntary; businesses that choose not to participate may continue to use the existing procedure.
5. Open Questions and Next Steps
The published key points represent a basis for discussion – not concrete legislative provisions. Neither a proposed start date nor a detailed legislative draft have been published. It remains open which businesses will qualify as ‘verified’ and how the procedure for establishing input tax entitlement will be designed. It is also unclear how the model will be integrated with the ongoing legislative process for the Annual Tax Act 2026. Businesses should monitor further developments closely.
6. Conclusion
The planned import VAT offsetting model is a long-overdue step towards strengthening Germany as an import location. If payment and input tax deduction are automatically offset in the VAT return going forward, a structural liquidity disadvantage that has put German importers at a disadvantage compared to their European competitors will be eliminated. However, concrete legislative implementation is still some way off – businesses would do well to keep track of developments and prepare their processes at an early stage.
