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Tax processing of cruises in the VAT area

The case concerns a complaint to the BFU regarding tax-related treatment of cruise packages. The question is whether the outlined cruises which call at Norwegian ports and which either start and/or end in a foreign port are exempt from VAT as direct transport to or from the VAT area, or whether they are to be regarded as a round trip in the VAT area and thus subject to VAT as domestic passenger transport.

The decisive factor for whether VAT is to be calculated or whether the exemption in the VAT Act § 6‑28 first paragraph applies is whether the cruise in the Norwegian VAT area has a duration of more than 24 hours. It was also assumed that to the extent that the cruises are exempt according to the VAT Act § 6-28 first paragraph, the accommodation and catering services on board the cruises will also be exempt from VAT according to the VAT Act § 6‑28 third paragraph.

The complaint is not accepted.

Source: skatteetaten.no

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