The Croatian Ministry of Maritime Affairs has announced that the regulations that govern the charter market in Croatia have been reviewed and it will, in the near future, be implementing a raft of changes that will bring the regulations in line with other European Union Member States.
“The main regulatory change is that charters starting outside of Croatia, in Montenegro for example, that then cruise in Croatia, will now have to pay VAT on the time spent in Croatian waters,” says Thibault Hermant, operations manager at SOS Yachting. “The VAT weight applicable is 13 per cent.”
Until the implementation of this update on 1 May 2017, only charters that had started in Croatia were subject to the 13 per cent VAT rate. As of May, 13 per cent VAT will be due on charter fees for number of days spent in Croatia. It is important to note that this VAT update will not apply to charters that had been booked pre-regulation change when VAT wasn’t due.
The restrictions that had previously been placed on non-EU commercial yachts under 40m chartering in Croatia have also been lifted. These restrictions, which prohibited non-EU commercial vessels under 40m chartering in Croatia, had been implemented to bolster the domestic market. However, they proved to be more costly than beneficial.
“Lastly, a charter license will be required for all non-European flagged vessels that are hoping to benefit from these changes,” says Hermant. The license is required even if the charter starts outside Croatia and a limited number will be provided by The Ministry of Maritime Affairs each year.