Eurozone VAT silly season continues
Just days after it emerged that a deferment was likely, the Italian government has confirmed that there will be no increase in the rate of VAT. Any hike will now be delayed until 1 October at the earliest.…
The Italian government has deferred the increase in the national VAT rate until 1 October 2013. VAT had been set to increase from the current rate, 21 per cent, to 22 per cent, but this met with opposition from the coalition government’s Right-leaning section.
The fast-tracked decision comes ahead of an EU Summit, the staging of which appears to have forced the fiscal hands of not only the Italians but the French authorities. France has announced that it has opted to initiate a reform of its VAT rules for yacht charters from 15 July. Charters will now be subject to a 19.6 per cent tax, slightly below the 21 per cent rate currently being exercised in Italy.
Whilst the decision of the Italian government not to increase VAT will be a welcome one for the country’s superyacht industry, it is but a small victory in a tough battle for the public’s affection. Like many of its neighbours, with the country’s finances under pressure, ‘luxury’ industries have become targets for public fundraising. Speaking at the Superyacht Fiscal Management Meeting in March, Moores Rowland Associati’s Ezio Vannucci warned that non-EU owned and registered yachts should expect to pay importation duty if they require temporary relief into EU charter. And in January 2012, the government introduced legislation that required visiting charter vessels to be registered with an Italian fiscal agent, to ensure the correct payment of taxes on transactions.
So, whilst the halt on VAT will be welcomed by charter brokers, it may still be hard to market Italy as an attractive destination, particularly with the emergence of non-EU alternative cruising grounds. However, one encouraging element is that vessels that operate outside of Italian waters for 30 per cent of the charter will only be subject to a rate of 6.3 per cent of the value of the charter.
The fast-tracked decision comes ahead of an EU Summit, the staging of which appears to have forced the fiscal hands of not only the Italians but the French authorities. France has announced that it has opted to initiate a reform of its VAT rules for yacht charters from 15 July. Charters will now be subject to a 19.6 per cent tax, slightly below the 21 per cent rate currently being exercised in Italy.
Whilst the decision of the Italian government not to increase VAT will be a welcome one for the country’s superyacht industry, it is but a small victory in a tough battle for the public’s affection. Like many of its neighbours, with the country’s finances under pressure, ‘luxury’ industries have become targets for public fundraising. Speaking at the Superyacht Fiscal Management Meeting in March, Moores Rowland Associati’s Ezio Vannucci warned that non-EU owned and registered yachts should expect to pay importation duty if they require temporary relief into EU charter. And in January 2012, the government introduced legislation that required visiting charter vessels to be registered with an Italian fiscal agent, to ensure the correct payment of taxes on transactions.
So, whilst the halt on VAT will be welcomed by charter brokers, it may still be hard to market Italy as an attractive destination, particularly with the emergence of non-EU alternative cruising grounds. However, one encouraging element is that vessels that operate outside of Italian waters for 30 per cent of the charter will only be subject to a rate of 6.3 per cent of the value of the charter.
The opaque nature of Italy's taxation system has been a constant discussion point at industry events.
Profile links
Moores Rowland Partners srl - YACHT DIVISION
Click here to become part of The Superyacht Group community, and join us in our mission to make this industry accessible to all, and prosperous for the long-term. We are offering access to the superyacht industry’s most comprehensive and longstanding archive of business-critical information, as well as a comprehensive, real-time superyacht fleet database, for just £10 per month, because we are One Industry with One Mission. Sign up here.
