Further transitional regulation for legal entities under public law

For the past seven years, legal entities under public law have been struggling with the transition to the new regulation of sec. 2b of the German VAT Act. A few have managed the changeover well. Most, however, failed to meet the (original) deadline. The changeover to the new VAT regime for the public sector was supposed to be completed by 31.12.2022. Now – at the last minute – the legislator has provided for a further transitional regulation of another two years by virtue of the Annual VAT Act. Legal entities under public law will now have had no less than 9 years to implement a single VAT provision. This is an unprecedented event in German VAT legislation.