Rooms rented out for prostitution in Germany do not qualify for a tax break granted to hotels, a federal court said today.
The full sales tax rate of 19 percent applies when rooms are used for commercial purposes, including sex work, the Federal Fiscal Court ruled from the southern city of Munich.
The reduced tax rate for hotels is seven percent.
"From the location of the building in a red-light district," the ruling said, "it is clear that the plaintiff did not keep the premises for accommodation, but for the practice of prostitution."
The plaintiff, owner of the "Eros Center" in the western city of Duesseldorf, rented out 13 "erotic rooms" equipped with jacuzzis to prostitutes on a daily or weekly basis, according to court documents.
The plaintiff argued the rooms were eligible for the tax break because they were not specifically designed for the provision of sexual services, but operated as regular hotel rooms.
Germany legalised prostitution in 2001, where it is in theory subject to standard tax and employment laws.
