this post was submitted on 17 Aug 2023
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You can thank our libertarian minister of finance and his debt-ceiling fetish for that. He's also the one who demanded that our 100 billion fond for the armed forces has to include VAT tax, which effectively lowers it to 84 billion.
He's also the guy who likes to protect the more than 20 billion in subsidies for fossil fuels or the car industry, yet wants to cut social services by 20 billion.
Why shouldn't it include VAT?
Because this tax goes straight back to the government. It buys weapons systems for a certain price, pays 19% VAT on top of it - back to itself.
So this means that the money which the ministry of defense was granted by the ministry of finance is just 84 billion plus an additional 16 billion (19% VAT) which will go straight back to the ministry of finance and can not be used to procure anything. A "true" 100 billion budget would have meant either a suspension of VAT on all payments or 119 billion provided by the ministry of finance, of which 100 billion can be used to buy systems and 19 billion would go back to the government as VAT.