VAT Rate at 6.6%

According to Article 11(1) of the Law Decree No. 76/2013 from 28th June (published in the Official Gazette No. 150), the planned one percentage point increase in the main rate of VAT (value-added tax) from 21% to 22% has become effective on 1st October 2013 (more info here).
Despite of this all EU/non-EU fiscal represented subjects with commercially registered charter yachts won’t be much affected by the increase as the VAT rate is still at a very reasonable level (new rate 6.6% only, in any case lower than in France where VAT rate is at 9.8%) and this should encourage anybody to pick-up charters in Italy!
See here the new up-to-date VAT Application Table here

Some examples of VAT application

Some examples of VAT application:


1. Motor Yacht (M/Y) with a length of 65 meters. Charter Fees: 200.000,00 euros.
VAT to be paid in Italy = 13.200,00 euros (VAT at 6.6% rate = 22% on 30% of Charter Fees)

2. Sailing Yacht (S/Y) with a length of 40 meters. Charter Fees: 120.000,00 euros.
VAT to be paid in Italy = 7.920,00 euros (VAT at 6.6% rate = 22% on 30% of Charter Fees)

3. Motor Yacht (M/Y) with a length of 23 meters. Charter Fees: 40.000,00 euros.
VAT to be paid in Italy = 3.520,00 euros (VAT at 8.8% rate = 22% on 40% of Charter Fees)

General Principles

General Principles: here some indications on how VAT is to be applied for EU charters:
– Charter starts and finishes in Italy and remains within 12 miles of the Italian Coast, VAT at the full rate of 22% will apply.
– Charter starts and finishes in Italy but, at some point, cruises 12 miles offshore into non-Italian Territorial Waters, VAT at a reduced rate of 6.6% will apply.
– Charter starts in another EU state before entering Italian waters, it is the VAT applicable in that state that will apply.
– Charter starts outside the EU (e.g. Montenegro, Turkey) and then enters Italian Waters, then VAT at the reduced rate of 6.6% will apply only to the portion of the charter taking place in Italy, providing it is demonstrable.
– Charter starts in an Italian port but then cruises to a non-EU state, VAT at the reduced rate of 6.6% will only apply to the portion of the charter taking place in Italian Waters.

It’s an excellent news!

It’s an excellent news! There is finally clarity about the VAT in Italy and commercially registered charter yachts will actually benefit from it !
By appointing a fiscal representative commercial yachts can now discharge all VAT on purchases made in Italy, like fuel, provisioning, spare-parts, repairs, etc.
The VAT rate is at a very reasonable level and that should encourage all charterers ”