Yachting community hits back at Brussels’ VAT claims
Four maritime and yachting organisations have insisted that Malta’s VAT rules on yacht leasing are in line with EU directives and based on similar models adopted by France and Italy.
They were reacting after Brussels threatened to launch infringement procedures against Malta that could even translate into heavy financial sanctions. Even if such a process was set in motion it would take years for fines to be imposed because the case would have to go before the European Court of Justice first.
European Taxation Commissioner Pierre Moscovici last week said he had raised the issue with both the UK and Malta.
According to him, some of Malta’s practices are “suspect”.
READ: VAT attracts €3.2bn superyachts
“I asked that the rules be changed and, if they aren’t, the European Commission will launch an infringement procedure that can bear extremely heavy financial sanctions,” he said.
According to Brussels, the practice of slashing the VAT rate on bigger ships on grounds they are used mostly in international waters is suspicious as it could give rise to tax avoidance.
Under this arrangement, owners of yachts longer than 23 metres pay a reduced VAT rate of 5.4 per cent instead of 18 per...