Study of the Impact of the reduced Value Added Tax Rate on the Investment Bottleneck in the Bavarian Accommodation Sector

The report presents the main results of a thesis dealing with the effects of a VAT reduction in the year 2010 on the investment behaviour of Bavarian hoteliers. This happens against the background of an investment bottleneck which originated over decades and a rising competitive pressure in this important sector of the Bavarian tourism industry. With an online questionnaire 425 hoteliers were interviewed, most of them identified the VAT reduction as a key factor for increasing investments and an improvement of their economic situation. These results are quite contrastive to the rather negative judgements by mass media and specialized literature.