The doubled VAT on takeaway food will hurt customers and businesses

The tax on takeaway businesses is set to jump to 12%, according to the 2026 budget guidelines unveiled by the federal government. The Walloon Horeca federation fears the devastating impact this measure will have on an already fragile sector.

Caterers, chip shops, sandwich shops, home delivery services, tourist accommodations... the bill is going to be terribly steep. These businesses, until now protected by a reduced rate of 6%, will be hit hard by the new budgetary measures decided by the De Wever government, which is doubling their value-added tax (VAT).

The federal government's intention is clear: simply to increase tax revenue. The executive branch, led by the Flemish nationalist, has "harmonized" the various VAT rates in the hospitality sector. The rule will now be a single rate of 12% for almost all services and products, with the exception of alcoholic beverages (which will remain taxed at 21%).

But behind this simplistic accounting logic lies a mixed reality on the ground, creating winners and losers. For café owners, the news comes as a relief, the application of the 12% rate on non-alcoholic beverages fulfilling a ten-year-old demand. For those in the sit-down restaurant sector, it's business as usual.

However, for takeaway restaurants and the tourism and hospitality sector, the consequences are expected to be dire. These businesses, previously protected by a reduced VAT rate of 6%, will be hit hard by a doubling of the rate to 12%. "This increase in the reduced rate will significantly impact the businesses concerned. For them, the federal government's decision is a shock of exceptional magnitude," warns the Horeca Wallonia federation.

The fear of losing customers

According to the professional advocacy group, this quest for new tax revenue by the government risks jeopardizing the survival of businesses. The equation seems inescapable: a VAT increase inevitably puts upward pressure on prices, which risks impacting household purchasing power.

So much so that the Walloon Horeca Federation fears "behavioral changes" among consumers: fewer outings, fewer takeaway treats, and an overall drop in foot traffic. In a sector with often razor-thin margins, this weakening could doom the most vulnerable establishments and destroy numerous jobs.

Sector analyses generally conclude that profit margins shrink for establishments that cannot pass everything on to prices (highly competitive areas, price-sensitive clientele), while better-positioned players, such as "millionaire restaurants" , capture a disproportionate share of the gains or better limit losses.

Economic literature also demonstrates that, during successive VAT increases in the hospitality sector, restaurant owners have raised their prices far more than necessary to recoup the resulting costs. Furthermore, a temporary VAT reduction, if subsequently reversed, can ultimately lead to higher prices than before, making any reversal of VAT in the hospitality sector politically and economically costly.

It is certainly necessary to wait for all the details of this newly revised and corrected taxation, in order to understand the subtleties between legal qualifications of provision of services, characteristics of products, place of consumption, allocation rules, franchise schemes.

But, faced with the urgency of the situation, Horeca Wallonie is not just asking for clarification, but for action. While awaiting a detailed analysis of the texts, the federation is demanding a sector-specific impact study and is advocating for a coordinated transitional phase, which it believes is the only way to cushion the blow for thousands of Walloon entrepreneurs.