Italy to Impose New Tax on Yachts

[sailorboy1]

Originally Posted by marshmat

The assumption is that if you own a newer boat, you can afford to pay more. That provision might not be kept, though.
.

So nothing really about costs of services provided. It's just a tax on "rich" people.

[SunDevil]

It sounds like they are taxing the rich and cutting off the poor from what little I've heard about Italy.

[Nicholson58]

We periodically have had a punative tax on "luxuries" in Michigan and also at the FED level. The Fed tax levied in 1991 destroyed many marine related industries. The Lesson Of Economic Damage From “Taxing The Rich” With The Punitive Luxury Tax In The 1990s This one along with Michigan's similar taxes were finally repealed (boats, cars over XXX dollars, fur coats, private planes) The Michigan result was a 1/3 reduction in marinas and dockage - now condos and private estates, furriers gone, private airports bankrupt, hot cars dealers gone. The bigger loss was Thompson Lymen, Chris-Craft, Owens, and others all disappeared. Many other builders limped along. The well-to-do simply found other outlets for their hobbies. The thousands who serviced these industries lost their jobs and the cash cow attacked by the government disappeared forever. The net money flow was instantly lower and quickly diminshed to well less than the starting point. The obvious is that any time a tax is levied uneavenly, geared to target a specific sector or business, it is viewed as a Federally sponsered deterrent. The effects are predictable and may not be reversable. People with discretionary funds will find other outlets if the system is unfair. Those with limited mobility who gladly helped part money from people who have it will pay the penalty - lost jobs & income.

[David M]

You tax what you want less of. Perhaps this will be to France's and Croatia's benefit and all the businesses that support yachts and aircraft in those countries. People have alternatives.

[SunDevil]

This isn't quite the same as Michigan. Companies and people could move to Florida to evade the taxes. In Italy they can't move to the next country over and still speak Italian. It is a little harder to leave a country. But, unless you run a cruise ship, 700 Euros a day would do it.

[donradcliffe]

Sardinia tried something like this in 2007, and AFAIK it was now heavily enforced and it disappeared after a year or two. The politicians just want to be seen as doing 'something' right now.

[s/v Jedi]

Oh my, when Hogan reads this, he is gonna have to put an engine back into his boat.... or pay double!

cheers,
Nick.

[Palarran]

Originally Posted by Nicholson58

We periodically have had a punative tax on "luxuries" in Michigan and also at the FED level. The Fed tax levied in 1991 destroyed many marine related industries. The Lesson Of Economic Damage From “Taxing The Rich” With The Punitive Luxury Tax In The 1990s This one along with Michigan's similar taxes were finally repealed (boats, cars over XXX dollars, fur coats, private planes) The Michigan result was a 1/3 reduction in marinas and dockage - now condos and private estates, furriers gone, private airports bankrupt, hot cars dealers gone. The bigger loss was Thompson Lymen, Chris-Craft, Owens, and others all disappeared. Many other builders limped along. The well-to-do simply found other outlets for their hobbies. The thousands who serviced these industries lost their jobs and the cash cow attacked by the government disappeared forever. The net money flow was instantly lower and quickly diminshed to well less than the starting point. The obvious is that any time a tax is levied uneavenly, geared to target a specific sector or business, it is viewed as a Federally sponsered deterrent. The effects are predictable and may not be reversable. People with discretionary funds will find other outlets if the system is unfair. Those with limited mobility who gladly helped part money from people who have it will pay the penalty - lost jobs & income.

Sorry, this is off topic but -

What in the heck does Michigan have to do with this? The luxury tax was a national tax and affected all the states. The reason Chris Craft went out of business is that they built a crappy boat at that time. I've lived on Lake Michigan my whole life and can say for sure there are more boats, and more expensive boats, by far right now then at any other time. We may not be able to put gas in the tanks, but we still got em.

When the economic fallout happened in 2008, Genmar holdings went belly up along with a lot of other small production companies. The giga-yacht builders - well, they did quite well in the following years. People with huge discretionary funds will find a way to pay for their play things and right now, it probably will be with tax free money.

[Rakuflames]

Originally Posted by goboatingnow

I see that as part of the new austerity measures, Italy is to introduce taxes on yachts, high performance cars and private planes. Well that's it then the Ferrari and the jet will have to go

Dave.

The US tried that in the 80's and put several yacht builders out of business, and put a huge dent in the used yacht business as well. I think they're going to find it will backfire.

[markpierce]

Where have all the California millionaires gone to?

[Nicholson58]

People are reasonably willing to pay fairly levied taxes. Its when we feel as though we are placed in the cross hairs of someone who feels it is unreasonable to follow our dream, own a yacht, car, boat, fur coat, jewels, etc. that we push back. The guy that buys a megayacht funded the employment of hundreds of people happy to have a job. The rest of us employ millions of people down the chain.

Interesting that the tax is by the foot assuming longer is any justification for charging more. We are 58 feet, sail power, LED lights, solar power, 115 HP aux. I buy 50 gallons of diesel a year and we use an air head. How does that compare to 58 feet of stink-boat? We will sell the house next year, live aboard. Its not a luxury - its our home and its smaller than a single-wide. Why should its 'tax' be greater than our current 2600 square foot home with 5 bedrooms and a pool? (a real boat-anchor in today's economy)

As I stated above, fair and equal taxes are not fighting words! Tax the PERCIEVED rich is bad policy. In this case, there is plenty of historic data to show that they are killing the golden goose.

[boatman61]

I've a feeling it will spread... to much potential revenue out there to waste...
To many countries (Politicians) in the crapper desperate for cash...

[David_Old_Jersey]

Originally Posted by Nicholson58

People are reasonably willing to pay fairly levied taxes. Its when we feel as though we are placed in the cross hairs of someone who feels it is unreasonable to follow our dream, own a yacht, car, boat, fur coat, jewels, etc. that we push back. The guy that buys a megayacht funded the employment of hundreds of people happy to have a job. The rest of us employ millions of people down the chain.

Interesting that the tax is by the foot assuming longer is any justification for charging more. We are 58 feet, sail power, LED lights, solar power, 115 HP aux. I buy 50 gallons of diesel a year and we use an air head. How does that compare to 58 feet of stink-boat? We will sell the house next year, live aboard. Its not a luxury - its our home and its smaller than a single-wide. Why should its 'tax' be greater than our current 2600 square foot home with 5 bedrooms and a pool? (a real boat-anchor in today's economy)

As I stated above, fair and equal taxes are not fighting words! Tax the PERCIEVED rich is bad policy. In this case, there is plenty of historic data to show that they are killing the golden goose.

I think the Italians have not only long since killed the golden goose, but have also cooked and eaten it Probably with Pasta

FWIW, my take is that the Italians are not really after genuine visitors (someone who actually leaves within a few months or so - and not someone who stays for years, beleiving that the duty on beer covers his "share" - as in Spain ) but instead they are after Italians who "don't" own boats that nonetheless either happily sit in Italy or visit when needed by the (non) owner.

It's probably as much about being seen to be doing something (on the tax raising side) and a data collection excercise (for the future) as it is about the cash collected (probably won't cover the collection costs).

[Buena Vista]

Originally Posted by boatman61

I've a feeling it will spread... to much potential revenue out there to waste...
To many countries (Politicians) in the crapper desperate for cash...

You are absolutely right Boatman. Sardinia tried it and it failed but then again, they had limited leverage as a small part of the market and too many other easy options.

Currently, we have options but Italy has this tax on the go, Greece has the 3790 tax hovering over the heads of boaties like the sword of Damacles and other countries have various cruising permits, like Croatia and Turkey. Other cash strapped countries will soon catch on that if they all introduce some form of tax, there will be nowhere else to go.

I am happy to spend my money in these countries and pay whatever tax applies, like VAT or whatever, I also don't object to paying cruising permits and thus contributing to the infrastucture required for our safety and comfort.

I think what happens with these taxes though, is that they are really trying to catch their own residents, or tax exiles, who are chronic tax avoiders and we as cruisers just get caught up in the slipstream.

However, the bottom line is we really don't get a lot of sympathy. Try telling an Italian or Greek who is struggling to meet their bills that we, who spend summer cruising around their best spots, are being hard done by.

Brownie

[boatman61]

Originally Posted by Buena Vista

You are absolutely right Boatman. Sardinia tried it and it failed but then again, they had limited leverage as a small part of the market and too many other easy options.

Currently, we have options but Italy has this tax on the go, Greece has the 3790 tax hovering over the heads of boaties like the sword of Damacles and other countries have various cruising permits, like Croatia and Turkey. Other cash strapped countries will soon catch on that if they all introduce some form of tax, there will be nowhere else to go.

I am happy to spend my money in these countries and pay whatever tax applies, like VAT or whatever, I also don't object to paying cruising permits and thus contributing to the infrastucture required for our safety and comfort.

I think what happens with these taxes though, is that they are really trying to catch their own residents, or tax exiles, who are chronic tax avoiders and we as cruisers just get caught up in the slipstream.

However, the bottom line is we really don't get a lot of sympathy. Try telling an Italian or Greek who is struggling to meet their bills that we, who spend summer cruising around their best spots, are being hard done by.

Brownie

Doubt it will affect transients as such... more likely an extra tax will be added to all registered owners in their own country... on top of the IVA etc...
At the moment the UK's hitting air travel.. will they turn their eye's to the sea..? its very possible.. its been done by the Queen...
why should HMG not follow where Her Highness leads...