For weeks, the coalition struggled to agree on new tipping rules—now an agreement has been reached. Tips will remain tax-free, but a uniform nationwide flat rate will be applied for social security contributions, replacing the previous regional patchwork. There was no agreement on the flat rate for a long time, but a solution has now been found, as reported by “Heute.” The flat rate is significantly lower than the initially proposed rate.
Representatives of the restaurant industry had previously demanded a complete exemption from social security contributions for tips. The union opposed this, arguing that it would undermine the social security of employees. At the beginning of July, the social partners reached a basic agreement. However, there were still disagreements within the coalition, with the Neos in particular putting the brakes on because they considered the planned flat rates to be too high. A lower amount has now been agreed upon.
The flat rates for tips serve as the basis for calculating social security contributions, which are graded according to the type of activity; i.e., they differ for waiters and waitresses who collect tips and those who do not. From 2026 to 2028, the flat rate will increase continuously, and from 2029 onwards, the amounts will be valorized.
The following flat rates will apply nationwide to the hotel and hospitality industry in the future:
– With collection: € 65 (from 2026), € 85 (2027), € 100 (2028)
– Without debt collection: €45 (2026/2027), €50 (2028)
The flat rates will be indexed for the first time in 2029.
These amounts will be considered binding upper limits in the future. Even those who receive more tips than the flat rate will not have to pay any additional taxes.
This will eliminate additional payments due to subsequent audits by social security agencies, which in the past often confronted restaurateurs with amounts that threatened their livelihoods. All ongoing proceedings in this matter are now to be discontinued, and no further payments will be required.
“The uncertainty surrounding tips has come to an end. The new regulation offers reliable framework conditions for both sides—for employees as well as for businesses,” says State Secretary for Tourism Elisabeth Zehetner (ÖVP). The sword of Damocles in the form of high additional payments has been removed. It was also important to her that a general amnesty apply to all those who had already received claims for repayment.
“Tips are a gift. A sign of appreciation from the guest. And that’s how it will stay,” says Deregulation Secretary and restaurateur Sepp Schellhorn (Neos) with satisfaction: “We have negotiated very intensively over the past few weeks to find a good, uniform, and unbureaucratic solution to the tipping issue. We have now succeeded in doing so together.”
“Tips were, are, and will remain tax-free. With this agreement, we have achieved a uniform nationwide solution that provides legal certainty for all sides,” affirms SPÖ social affairs spokesman Josef Muchitsch.
The fact that there will now only be two flat rates instead of dozens of different ones depending on occupational group, position, and federal state is a real milestone: “The new regulation has the potential to serve as a model for reducing bureaucracy in many areas,” said Walter Veit, president of the Austrian Hoteliers Association.
The new regulation provides complete exemption from taxes above a reasonable flat rate, eliminates the risk of retroactive tax assessments, and ensures long-term legal certainty—for employees as well as for businesses, according to Minister of Economic Affairs Wolfgang Hattmannsdorfer (ÖVP): “Especially in the competition for urgently needed skilled workers, reliable framework conditions and genuine appreciation for employees are needed.”
The agreement ultimately means better social security for employees in the catering industry, explained Helene Schuberth, Federal Managing Director of ÖGB.
- source: heute.at/picture: Image by Engin Akyurt from Pixabay
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