France to Remove VAT Exemption on Super Yacht Charters

VAT and the conflicting regulations posed by different countries in the Mediterranean have made life difficult for charter brokers.  Just when brokers think they have got it clear in their minds, so the rules seem to be on the change again.
France has, in the recent past, greatly benefitted by allowing charter yachts working in and out of France to be exempt from 19.6 % VAT the country levies.  

Those representing the industry have long argued against the implementation of the tax saying it would have a negative impact on the charter sector. But now it seems they will have to change their rules to conform with neighbours in Spain and Italy.
The impending change is being brought about by the the European Commission who have formally requested France to remove the tax exemption on luxury yacht charters warning it would refer the matter to the European Court of Justice if France did not comply within two months.
Citing the regulations, the statement adds, “The VAT Directive provides for the exemption from VAT for certain transactions involving boats. However, this exemption does not apply to luxury boats used by individuals for recreational purposes.”