On January 29th, the French Tax Authorities published in the Official Tax Bulletin that the VAT lump sum reduction will be replaced with an effective reduction in proportion of the time spent outside European waters.
The new rule should have been applied on charter contracts concluded from March 30th.
As the changes made to the conditions for determining the taxable base have been withdrawn, the VAT lump sum reduction (20% on 50% of the charter fee) is still applicable in the case of cruising in international waters (BOI-TVA-CHAMP-20-50-30).
In Italy, UCINA Confindustria Nautica (Italian Marine Industry Association) is in a dialogue with the Italian authorities to postpone the application of the new law.
DISCLAIMER | The information provided in this text is for general information purposes only and doesn’t replace the advice of a legal advisor or of a tax consultant.
