Train travelers in Germany have an extra reason to celebrate entering 2020 — the national railway company Deutsche Bahn is cutting prices for long-distance rides. The government wants more people to take the train.
Deutsche Bahn has unrolled new prices for 2020 and made its tickets 10% cheaper for long-distance traffic, the German railway company said. The move, which went into effect on Wednesday, stems from the climate protection measures passed by the German government – the Cabinet cut the value-added tax (VAT) on rail travel in December from 19% to 7% in an effort to make train travel more attractive.
"We are passing on this tax cut to our customers," Deutsche Bahn said on its website.
The new prices apply to trips of over 50 kilometers (31 miles), but only if the passenger travels from one railway region into another.
The company is also cutting prices on special offers and additional services, such as fees for transporting bicycles.
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Millions more passengers
Deutsche Bahn has pledged to also cut prices for the over 50-kilometer trips within the same railway region, but this change will only be introduced in another six months, according to the Inside Digital tech portal.
The company head, Richard Lutz, said Deutsche Bahn would not directly collect any profits from the tax cut and instead pass on any savings directly to ticket buyers. At the same time, the company believes the price drop would bring in another 5 million passengers per year.
Waiting for new trains
The head of the Left party, Katja Kipping, said that the tax cut was "long overdue."
"It's really not enough," she told Deutschlandfunk radio.
Kipping once again urged the government to give every German citizen a free BahnCard 50, which grants up to 50% discounts on already lowered Deutsche Bahn tickets.
The state-owned company is also set to spend some €12 billion ($13.46 billion) by 2026 to buy new trains, most of it for its Intercity-Express (ICE) fleet.
Deutsche Bahn is a private, joint-stock company with the Federal Republic of Germany being its single shareholder. The government hopes to reform the troubled transporter as the country works to reduce carbon emissions.