German university town plans new tax on prostitutes

BERLIN (Reuters Life!) - The German university town of Marburg is planning to introduce a tax on its prostitutes based on the size of the establishment where they conduct their business, a local official said Tuesday.

Rainer Kieselbach, spokesman for the city of Marburg that is better known for being the home of the world's oldest protestant university, said the lump sum tax was aimed to raise an estimated 90,000 euros in annual tax revenues.

"The prostitutes will be taxed for their services, but not for the entertainment acts, such as table-dancing," Kieselbach said. "We decided to tax them based on the size of their working rooms -- a daily flat rate of 2.50 euros per 10 square meters."

A group of 22 masked prostitutes protested against the tax in a city council meeting last week.

Prostitution is legal in most of Germany and sex workers are required to pay income tax as well as value-added tax. Tax collectors in Germany have long suspected their income and VAT was not being fully reported.

Marburg, a town of 80,000 people about 80 km north of Germany's financial capital of Frankfurt, is following large cities like Cologne and Berlin to introduce a flat tax.

(Reporting by Josie Cox; Editing by Matthew Jones)