“From September 2013 we have been having this Spanish VAT problem with non-EU flagged vessels from outside of the CCT [Community Customs Territory] that, even having been imported in free circulation in the EU are being treated as non-EU goods when sailing out of the CCT and re-entering Spanish waters, even if the yachts have been in a port outside of the CCT waters for one day,” Miguel Ángel Serra Guasch, lawyer at Garrigues, tells SuperyachtNews.com.
Serra explained that the Spanish customs authorities and Balearic Islands Customs Office consider these yachts subject to 21 per cent VAT, as a new importation through Spain, and support their argument by claiming that the status of EU goods acquired in initial importation in the CCT is lost when the goods leave the CCT, unless a ‘return goods relief' customs regime has been applied for which, added Serra, is something “hardly anyone does”.
No such rules are applied to Spain’s main competitors in the nautical sector – France, Italy and the UK – and Serra added that there is no evidence to suggest other Spanish regions, such as Barcelona and Valencia, apply the same rules. “[This] seems to be a tremendous discrimination for the charter industry in Sapin, especially in the Balearics and, consequently, for any other related businesses such as ports, marinas and shipyards,” he told SuperyachtNews.com.
As a result, the main Spanish yachting associations concerned with this taxation structure, with Serra, have approached Madrid’s Ministry of Finance, though Serra revealed they did not initially seem disposed to make any changes. However, with a limited number of superyachts now visiting the waters concerned, there is hope that by halting the money coming in via these assets, the impact on the economy might become the catalyst for change.
Serra explained that the situation have no sense as the criterion of the Spanish tax Authorities is based on the Community Customs Code (CCC), the provisions for its implementation, and the European VAT Directive, something that should be applicable in identically in all EU countries and should produce the same final results.
Those seriously concerned about the effects of this application are taking the matter to the high courts and are hopeful the tax authorities will refund the money collected under these provisions. Although this can, according to Serra, take up to eight to 10 years to see through if all legal remedies were to be exhausted.
"In the mid to long term the industry built around the yachting industry could be destroyed,” said Serra, who added that the money circulating within the yachting industry in Spain is already much lower than in France or Italy in proportion to its gross domestic product (GDP).
“This is the reason we are currently acting at all possible levels and have contacted the European Boating Industry in Brussels for lobbying purposes.” Spanish MEP Rosa Estarás, the Spanish National Nautical Industries (ANEN), for which Serra is a tax advisor, and the Spanish Large Yachts Associations (AEGY) have requested a meeting with Miguel Farré, secretary of state for finance, to attempt to solve the problem. In the meantime, Serra has also been approached by representatives of the State Port Authority to prepare a memorandum explaining the situation, which has now been delivered to the Spanish Government to be discussed with current finance minister Cristobal Montoro.
SuperyachtNews.com will provide updates as the situation progresses.
European Fiscal harmonisation is a key component of the programme for the 2015 edition of the Superyacht Management Meetings: Fiscal, held on 28 April in Monaco. Register for this event here.