Pleasure craft rental: an unsolved problem / FOCUS

1. As has already been written, the new legislation applicable for VAT purposes to short-term and not short-term leasing, rental and similar services of pleasure boats, provides for the criteria of effectiveness, to purposes of determining the tax base, with a consequent de facto application of VAT in full, at least for all those pleasure craft used along the Italian coasts, or in any case in European Union waters. Only to the aforementioned operations (specifically, operations resulting from short-term and not short-term lease, rental and similar contracts of pleasure boats), carried out before 1 November 2020, may continue to apply, pursuant to law , the indicative percentages of the presumable use of boats outside the territorial waters of the European Union, established with the circular of the Revenue Agency of 7 June 2002, no. 49 / E, integrated with the circular of 22 July 2009, n. 38 / E, and subsequently confirmed with the circular of 29 September 2011, n. 43 / E.

The new regime is illustrated and explained by the Revenue Agency in Resolutions 47 / E of 17 August 2020 and 62 / E of 30 September 2020.

Therefore, starting from 2 November 2020, flat-rate VAT applied to the rental fees of pleasure boats is sufficient.

2. In the meantime, the draft legislative decree containing supplementary and corrective provisions to legislative decree 3 November 2017, no. Was sent to the Chambers for the acquisition of the opinions of the competent committees. 229, concerning revision and integration of the legislative decree 18 July 2005, n. 171, bearing the Code of pleasure boating and implementation of Directive 2003/44 / EC (101-bis).

In this context, the accompanying report states that in order to facilitate the rental, art. 17 of the scheme reformulates art. 47-bis of the Code which governs the rental of pleasure craft, providing that the rental contract can also be made with respect to several cabin charterers, being able to stipulate individual contracts for each cabin; consequently, articles 18 and 19 of the scheme also coordinate the provisions of the Code (articles 48 and 49) concerning the relative insurance policy of the renter, which in the case of several cabin renters must be extended to these, as well as the obligation to contribute to the running costs of the chartered unit, also extended to the case of cabin charter.

Article 47 of the Code, as far as we are concerned, would be replaced by the following: ART. 47 - Pleasure craft rental - Paragraph 1. Pleasure craft rental is the contract by which the lessee, in consideration of the agreed freight, undertakes to make available to the other party, the charterer or more cabin charterers, respectively , the pleasure craft or part of it for a specific period to be spent for recreational purposes in marine areas or inland waters of its choice, stationary or under way, under the conditions established by the contract. Paragraph 4. The hired unit remains in the availability of the hirer, under whose dependence the crew also remains. In the case of cabin charter, unless the parties will otherwise, more rental contracts are stipulated for the number of charterers of each cabin or group of cabins covered by the contracts. In any case, the contracts indicate the number of people to board.

It is clear that recourse to cabin chartering will be held back, and not favored, by the new VAT regime applicable to short-term and not short-term leasing, rental and similar services of pleasure boats.

3. No more flat-rate VAT, but the freight rate not subject to tax (which is, and has always been, 22%) must be demonstrated with the effective use and effective use of the service outside the European Union pursuant to article 1, paragraphs 725 and 726, Law 2 December 2019, n. 160, amended by article 48, paragraph 7, of the decree-law of 16 July 2020, no. 76, converted with amendments by Law 11 September 2020, n. 120 (Published in the Official Gazette no.228 of 14 September 2020). The aforementioned provision was introduced following the reasoned opinion with which (on 25 July 2019) the European Commission, pursuant to art. 258, first paragraph, of the Treaty on the Functioning of the European Union, has accused Italy of the violation of the provisions of Directive 2006/112 / EC (VAT Directive) which determine the "territoriality" of leasing and rental operations.

As for the means and test methods suitable to demonstrate the use and fruition of the pleasure boat outside the European Union, pursuant to article 7-quater, paragraph 1, letter e), and 7-sexies , paragraph 1, letter e-bis), of the decree of the President of the Republic October 26, 1972, n. 633, Provision Prot. No. Has just been published on the website of the Revenue Agency 341339/2020 29 October 2020.

The Provision provides that the actual use and fruition of the pleasure boat outside the European Union must be inferred from the lease, including financial, rental, and other similar contracts, also on the basis of the declaration made by the user of the boat itself under his own responsibility at the time of making the boat available.

Proof of use and fruition outside the European Union of the vessel equipped with satellite navigation systems or transponders must be provided through data and information extracted from the navigation systems in use. Proof of use and fruition outside the European Union of the boat not equipped with satellite navigation systems, will instead be provided through the presentation of the lease contract, including financial, rental, and other similar contracts, shortly term, accompanied by the production of at least two of the following means of proof:
i. the paper or digital data of the navigation log or logbook;
ii. the digital photographs of the ship's dock for each week of navigation identified by any device and detected with a frequency of at least two, for each week of navigation;
iii. the documentation proving (invoices, contracts, tax receipts and related means of payment) the mooring of the pleasure boat at ports located outside the European Union;
iv. the documentation certifying (invoices, contracts, tax receipts and related means of payment) purchases of goods and / or services, from commercial establishments outside the European Union, relating to the use of the vessel outside the European Union pleasure.

The Provision, to which reference is made for a complete reading, also deals with specifying the terms of conservation of the test documentation, its applicability (i.e. from the date of its publication, or from 29 October 2020) and its reasons.

*Partner, Gianni Origoni Grippo Cappelli Law Firm