The Dutch Secretary of State of Finance has sent a letter to Parliament on the changes in the Dutch regulation for the VAT zero rate of seagoing vessels. In the letter, a further explanation is given on the on the Dutch scheme for the VAT zero rate of seagoing vessels that must be amended following a designation of the European Commission.
Currently, the Dutch exemption is linked to so-called seagoing vessels, without the requirement that these seagoing vessels are actually used for navigation on the high seas. According to the European Commission, this provision was formulated too broadly in the Dutch VAT Act. The application of the zero rate is therefore tightened up and as of 1 January 2018 only applies if such vessels are actually exploited for at least 90 percent for navigation on the high seas.
This means that the VAT zero-rate no longer applies to the supply of goods and services of vessels that operate (almost) exclusively within the 12-mile zone, such as tugs, ferries or commercially operated yachts. In that case, the general VAT rate of 21% applies to local deliveries and services within the Netherlands.
Source: Rijksoverheid (Dutch)
Source: MKB.nl (Dutch)
