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Comparative tax France VS Israel VAT on restaurants

Israel VAT on restaurants

VAT rates on restaurants in France and Israel differ significantly, impacting the taxation of catering establishments. In France, all dishes served in restaurants are charged at the intermediate rate of 10%, while in Israel, restaurants are subject to a VAT rate of 17%.

VAT on restaurants in France

In France, the VAT applied to restaurants varies according to the type of service offered. The intermediate rate of 10% is charged for all dishes served in the restaurant trade, whether in traditional restaurants, bars or cafés, in the dining room or at the counter.

For takeaways and home deliveries, ready-made meals (such as pizzas, sushi, salads and sandwiches) are also subject to the 10% VAT rate, as they are intended for quick consumption.

For beverages, the standard rate of 20% applies to the sale of all alcoholic beverages, while the intermediate rate of 10% applies to the sale of non-alcoholic beverages for immediate consumption.

Read also: Can restaurant expenses be deducted in Israel?

VAT on restaurants in Israel

In Israel, restaurants are subject to a VAT rate of 17%, which applies to the majority of restaurant types, including traditional restaurants, bars, cafés and room or counter service.

For establishments offering takeaway sales or home delivery, cooked and delivered dishes (such as pizzas, sushi, salads, sandwiches, etc.) are also subject to the VAT rate of 17%. This rule differs from that applied in France, where these dishes benefit from a reduced VAT rate of 10%.

For beverages, the VAT in Israel does not vary between alcoholic and non-alcoholic beverages: all are taxed at 17%, unlike France, where alcoholic beverages are taxed at 20% and non-alcoholic beverages for immediate consumption are taxed at 10%.

Comparison of VAT on restaurants in France and Israel

VAT taxation on restaurants in France and in Israel has both similarities and differences. Both countries apply a VAT system, with rates varying according to the types of services offered. However, the rates and application rules differ between the two countries.

As mentioned above, in France, all food served in restaurants is billed at the intermediate rate of 10%. The types of catering concerned include traditional restaurants, bars and cafés, whether in the dining room or at the counter. For restaurants offering takeaway or home delivery services, cooked and delivered dishes (pizzas, sushi, salads, sandwiches) will be subject to the VAT rate of 10%. The standard rate of 20% applies to the sale of all alcoholic beverages, while the intermediate rate of 10% applies to the sale of non-alcoholic beverages for immediate consumption.

In Israel, restaurants are subject to a VAT rate of 17%, which applies to the majority of restaurant types. The rules of application are similar to those in France, but the rates are higher, particularly for beverages.

Consequences for French and Israeli catering establishments

The effects on restaurant competitiveness also depend on the cost structure and margins practiced by restaurants. However, it is important to point out that the difference in VAT rates may be a factor influencing the competitiveness of restaurants in these two countries.

As French establishments benefit from a lower VAT rate, they may be able to attract more customers thanks to lower prices.

Cabinet Dray & Natco's tax services

Dray & Natco offers expertise in Israeli accounting and taxation, particularly for catering establishments. This expertise is crucial for businesses operating in both France and Israel, as we saw earlier with the differences in VAT rates between the two countries.

Dray & Natco assists companies and individuals with their tax affairs, offering services tailored to their specific needs. These services include analysis of tax differences between France and Israel, implementation of strategies to optimize restaurant taxation, and compliance with local VAT regulations.

Conclusion

It's essential for catering establishments to understand the tax differences between France and Israel, particularly where VAT is concerned. In France, all dishes served in restaurants are charged at the intermediate rate of 10%, while restaurants in Israel are subject to a rate of 17%. The types of restaurants concerned, the rules for applying VAT to takeaway sales or home delivery, and the rates applicable to alcoholic and non-alcoholic beverages also vary between the two countries.

Faced with these tax differences, it's essential to seek the help of an expert in accounting and taxation. Our services will enable you to obtain tailored advice on the tax management of your restaurants in Israel and France, so as to optimize your tax situation and make the most of the tax advantages available in each country.

Don't hesitate to contact us to benefit from our expertise and personalized support in managing your catering business.

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Boruch Levenson - CPA

A native English speaker qualified in both Israel and the UK, Boruch cares for the English speaking clients.

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Our firm specializes in Israeli accounting and taxation, with in-depth expertise in Olim Hadashim benefits and tax optimization.

Our consultants in Tel Aviv

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Our consultants in Jerusalem

English speaking accountants in Israel
Address: Kanfei Nesharim 68. Merkaz Oranim
Phone number: 02 631 9000
Fax: 02 631 9005
Email: office@cpa-dray.com