This is being announced by German chancellor, Olaf Scholz, as the government is trying to reduce the burden for consumers. For some context, the tax otherwise would be 19% and the government is hoping that companies will pass on the VAT cut in full to consumers as such.

The move above comes after Brussels rejected Germany's request for an exemption on its new gas price levy - which was proposed as a measure by the German government in order to help Uniper and other gas importers cope with soaring prices due to reduced Russian export flows.