On March 18, 2025, the Ministry of Finance published a special regulation for small businesses (Sonderregelung für Kleinunternehmer), implementing EU Directive 2020/285. As of January 1, 2025, both the German VAT Act (Umsatzsteuergesetz) and the Annual Tax Act 2024 (Jahressteuergesetz 2024) have been updated.

Small businesses in Germany can claim tax exemption domestically for sales ge…