Practical Boat Owner June 1992 [antikvár]

More on VAT Subsequent to my note last month about the importance of having VAT receipts for your boat (and her equipment and contents) there is news that an agreement in principle has been reached in Brussels involving VAT systems to be implemented in due course. The Directive accepts the fact that a common system of VAT cannot be in place by 1 Jan 1993 and special rules will be applied. Under them sales of new boats over 7.5m LOA to private buyers will be taxed in the country of destination until 1996. This rule will also apply to goods sold to private buyers by Mail Order when the sellers' sales volume exceeds a threshold level. Usually, goods will be taxed in the country of origin. A new boat will be one supplied less than 3 months after it first entered into service, or has sailed {or motored) for less than 100 hours. Boats smaller than 7.5m will require tax payment in country of origin. These arrangements will end VAT-free exports for boats unless destined for non-EC waters. Currently, residents of the UK and Channel Islands are able to take their boats an3^here within the EC without liability for VAT provided that temporary importation conditions are complied with. This will not be the case after 1 Jan 1993 when it will no longer be possible for a resident in one EC member state to buy a new boat and keep it anywhere within the EC without paying VAT — either at the point of sale or in the country of destination. It is also likely that the movement of a boat between member states will only stop being a taxable event if proof of previous VAT payment can be produced for inspection. How all this will affect older boats sold pre-VAT, or boats which have passed through several owners with VAT receipts lost along the way, is yet to be determined. In many instances getting back to the original builder or agent for proof that VAT was paid will be impossible given the fluid nature of the industry and the number of boat builders which have come and gone over the years. In fact the Directive ignored this area when it was drafted and it seems that member states will have to decide for themselves how to deal with the presence of older boats in their waters. There is, perhaps, a glimmer of hope contained elsewhere in his statement where he invites the Irish Government to join with the UK in an approach to the European Commission over the distortion to competition currently caused by the different methods of financing marine navigational aids within the EC. I gather that most member states pay for the installation and maintenance of such nav'aids out of general taxation and perhaps the Commissioners will direct the UK to do likewise! NFSS Guernsey Rally Member schools of the National Federation of Sea Schools are offering the public a chance to join in the