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.