Spain VAT

[Paulxyz2004]

Big difference between sales tax % charged by the state/municipalities vs the rate charged on the continent.

 

As I always like to learn something, what´s the big difference?

[nelblu]

As I always like to learn something, what´s the big difference?

 

Single digit vs double digits. For instance, in NJ the sales tax is 7% and is not applicable to clothing, shoes, food products, and pharma. In some counties the tax rate is 3% and this is to encourage spending in depressed areas.

[FirstCruise2331]

Big difference between sales tax % charged by the state/municipalities vs the rate charged on the continent. Room taxes and occupancy rates, that is a different animal. Also, a few years ago, we sailed out of Barcelona on a 12 nite which covered all EU countries and I pre-booked specialty restaurants and excursions and no VAT charged. An earlier Med., one of the ports was Croatia, prior to becoming a EU member, and no vat charged whatsoever during the cruise--don't know if one purchased an item while in Soanish waters if RCL charged a vat.

 

Ps. Tried one time to recover vat for items/services purchased at on land at the Barcelona airport , and the line was so long and moved so slow that it was not worth it.

 

The difference in rate still doesnt make it a 'ridiculous' tax. Its the exact same principle. Room tax in a hotel over and above the standard rate is not a different animal- its a charge levied by the city to collect money for its revenues. As for difference of treatment on your different cruises, it depends on circumstances but if you are buying goods or paying for services within EU (including territorial waters) RCI are obliged to charge VAT.

 

Fyi -You cant claim VAT back on services consumed, only on goods over a certain value that are being taken outside the EU (i.e. You bring them home). There is no similar redund mechanism in the US for sales tax. VAT Was introduced in 1972 across the EU and isnt going away so the only thing I can suggest is you suck it up and pay like the rest of us or take your cruises outside the EU. Although I should say that VAT (sometimes called GST) applies about 130 countries worldwide. The US is one of the exceptions in the developed world.

[dutchclogs]

There's case law on this! If tip/service charge is mandatory then its part of the 'consideration' so VAT is charged on the tip as far as I recall (or at least its supposed to be).

 

 

That's what I was thinking though it may indeed have not have been consistently applied.

[Frankmac]

There's case law on this! If tip/service charge is mandatory then its part of the 'consideration' so VAT is charged on the tip as far as I recall (or at least its supposed to be).

 

What if tips are exempt from VAT in Spain?

[FirstCruise2331]

What if tips are exempt from VAT in Spain?

 

If that was the case and the drinks to which the tips applied were served in Spainish waters would be exempt I think. As far as I know the case law applies across all of EU though.

[grmmybtty]

Could someone please clarify this question for me - If we were on a Med cruise that travelled from Barcelona to Venice, with stops in 2 non-EU countries (Monte Carlo and Montenegro) do we have to pay VAT tax on purchases of alcohol at every EU port or only while we are in Spanish waters?

[John Bull]

Could someone please clarify this question for me - If we were on a Med cruise that travelled from Barcelona to Venice, with stops in 2 non-EU countries (Monte Carlo and Montenegro) do we have to pay VAT tax on purchases of alcohol at every EU port or only while we are in Spanish waters?

 

For most purposes, definitely including EU VAT, Monte Carlo (it's actually the Principality of Monaco) is part of France and in EU taxation territory.

 

But Montenegro definitely is not.

(To confuse you even more, oddballs like Gibraltar & the Channel Islands & the Canary Islands are part of the EU but they too are outside the EU taxation territory).

 

Because your cruise includes a port (in Montenegro) outside the EU taxation territory, in theory you should not be charged VAT anywhere.

But don't rely on that, because Spain does seem to have its own interpretation of the regulations. :rolleyes:

For instance, on cruises we've sailed out of the UK and Italy and Greece we've not been charged any VAT anywhere at all - including Spanish ports-of-call - when the cruise has included a non-EU taxation territory port.

But I'm aware that folk sailing out of Barcelona have been charged VAT in Spanish waters, regardless of the cruise itinerary.

Go figure :confused:

 

All this regarding purchases on the ship - all purchases ashore will include the appropriate VAT in the price.

 

As per earlier posters, you can reclaim VAT paid on stuff you take home - but as you'll have learned from those posts this isn't usually quick & easy, is subject to a minimum total value, and isn't worthwhile for low ticket-price items.

 

Not the definitive answer you're looking for, but the best I can do.

 

JB :)

Edited October 2, 2015 by John Bull

[grmmybtty]

Thank you John Bull for your succinct answer. The idea of an extra 10% added to 18% gratuity for onboard alcohol purchases is much easier to take on a 15 day cruise if it only applies to the first 2 days when we are in Spanish waters. We had a similar experience duting our Lisbon to Rio cruise as the ship entered Brazilian waters and a 20% tax on top of the 18% gratuities were applied.

[EDL]

Right ! I have read a load of well intended comments on this subject but still have not got an answer to my question.

 

Ok here we go...

 

I have purchased 3 Ultimate Drinks Packages for our next cruise, all 3 individuals enjoy a drink.. Ok so I have set the scene lol..

 

In the price of the package the 18% Gratuity is already included .. So I'm chilled on that one.. Almost..

 

Right here's the thing.. Lol.. If I order a drink priced on the menu at $14 and the bar person says thank you Mr Larkin, your looking really well tonight - is that a new aftershave your wearing - but hey that drink you just ordered has an additional charge of 10% for Spanish VAT.. and you know Mr Larkin that your Ultimate Package has a limit of $14 only.. So you will have to pay the extra .. Is this what will happen ? Will I be charged $1.40 for every time I order a full priced beverage ?

 

I look forward to your replies,

 

Ed

[MADflyer]

.. So you will have to pay the extra .. Is this what will happen ? Will I be charged $1.40 for every time I order a full priced beverage ?

 

I look forward to your replies,

 

Ed

 

As you are not being charged on the cruise for the drink you will not be charged VAT on the individual drink.

 

If you add a double and the charge is $3.00 over the allowed price, you would be charged the VAT on that extra amount that is a charge incurred directly onboard the ship.

 

The way it has worked in the past is that VAT was not charged on drink packages purchased in advance as you have paid in your home currency. Those that purchase the drink package onboard would be charged the VAT on the package and not each drink.

 

Some passengers have reported recently that they have been charged the VAT on drink packages purchased in advance. By bundling the drink package into an offer, the lines can avoid that passengers must pay the VAT.

[juniper berries]

I got to wondering about this issue as well as we have a beverage package as part of a cruise line promotion. One other question on the VAT is it in all European countries or just Spain. And if so can you be refunded for VAT that was charged outside of Spain. Thanks :)

[grmmybtty]

I believe that the VAT refund is also applicable for items purchased in Spain. VAT is not refundable in any EU country for consumable items - food and drink purchased either aboard a ship on or land. There are also rules as far as minimal amount for purchases, so unless you buy a big ticket item, getting a refund isn't worth the time or trouble.

 

My concern was when to buy the wine package. Since we have a lot of OBC, I wanted to wait until after we boarded to buy the package. But if we are charged for VAT only in Spanish waters, I can wait until day 3 to make my purchase. Since we are able to bring wine onboard, we will just buy some wine in Barcelona and pay the corkage fee for the first few days.

[John Bull]

I got to wondering about this issue as well as we have a beverage package as part of a cruise line promotion. One other question on the VAT is it in all European countries or just Spain. And if so can you be refunded for VAT that was charged outside of Spain. Thanks :)

 

Can't really help any more with the main query, VAT on drinks packages.

But for a bit of background .........

 

 

VAT is effectively a sales tax.

More complicated than that for those involved in providing the goods & services, but as a consumer you can treat it as a simple sales tax.

I think all EU countries (certainly the major ones) have VAT.

 

In the same way that the percentage varies from state to state in the US, it varies from country to country in the EU. Greece has recently increased its VAT on some services in the wake of its financial woes.

 

The percentage of tax also varies depending on the type of goods & services. Typically in most EU countries things like basic foodstuffs, books, transportation, aren't taxed and some goods & services such as electricity are charged at a lower percentage than "luxury" goods. Snacks & meals in cafes & bars & restaurants are taxed as a catering service, not as foodstuffs.

 

The big difference throughout the EU compared to the US & many other countries is that the VAT has to be included in the ticket-price in retail outlets. If a shirt is priced at 10 euros, then 10 euros is what you pay - the VAT isn't added at the till.

 

There are complications (aren't there always :rolleyes:). For instance goods & services provided business-to-business are priced excluding the VAT, and VAT is added to the invoice. Sounds complicated, but it actually makes it easier for businesses in the supply-chain. So if you buy something for the car at a High Street car accessory shop the price is inclusive of VAT, but if you buy the same thing from a motor factor (they deal primarily with repair garages) the VAT is added at the till. But that's unlikely to affect the average tourist.

 

VAT reclaims.

VAT is added at every stage in the supply chain. The manufacturers collect VAT at the appropriate rate from their customers (for instance, wholesalers) but reclaim any VAT that they paid on the raw materials & overheads. The wholesaler charges VAT at the appropriate rate to the retailer, but reclaims the VAT that they paid to the manufacturer and in their own overheads. The retailer then collects VAT at the appropriate rate when they sell to the consumer but reclaims any VAT paid to the wholesaler or in their own overheads. Hence the term "Value-Added Tax".

This chain works both internally & between EU countries.

Sounds a great deal more complicated than it is, and apart from a few money-go-round exceptions it's actually an efficient process.

All of which is irrelevant to you :rolleyes:

 

If, as a consumer, you buy something in one EU country you can't reclaim VAT when you take it to another EU country - VAT can only be re-claimed on goods taken out of the EU.

Hence, as others have stated, consumers can't reclaim VAT on hotel bills, meals, etc.

If you buy something & take it out of the EU, you reclaim in the last country before leaving the EU. So if you buy something in Rome during a cruise & fly home from Barcelona, you reclaim in Spain, not Italy.

 

I think the minimum qualifying purchase from one outlet (can be the total of several items bought from one outlet) is 175 euros. And even if your purchases from that one outlet cost a little more than 175 euros the refund probably won't be worth the grief.

If you buy considerably more, you need better advice than I can give you.

.................................................................................

 

Back to the all-you-can-drink packages.....

it's my understanding that if you buy before the cruise, you will not pay more than the quoted price. I have no idea if that price includes VAT or if no VAT is payable - but does it matter? The price is the price.

If you buy on the ship on a qualifying cruise, I have no idea whether VAT is then added.

If you have an all-you-can drink package, you will not have to pay VAT on each drink. Your package isn't priced per drink, therefore there's no way to charge a percentage.

 

Grmmybtty - I think you need to get your answer from the cruise line. Good luck with that :D

 

Simple, innit? :rolleyes:

 

JB :)

Edited October 3, 2015 by John Bull

[grmmybtty]

Thank you John Bull. I Washington familiar with VAT while traveling on land. Never purchased enough at one place to bother filing for VAT. Application to cruise ship purchases is a fairly new phenomenon. I'll check once on board, but will also bring some our own wine too.

[jonbgd]

on our westbound TA aboard the Allure from Barcelona only stop Malaga 3rd day

So We will be charged Spain VAT from time of boarding in BCN till leaving Malaga?

Or until we get out of Spanish waters? past Rock of Gibraltor?

Edited October 3, 2015 by jonbgd

[grmmybtty]

I am guessing that is the case. For us, we depart from Barcelona, calling next at Palma de Mallorca. I am thinking that once we leave Palma for Marseille, there will not be the matter of VAT charges on onboard purchases.

[LaCal]

My question is this......Leaving on the Carnival Vista and Izmir Turkey port was canceled.......Embarking port is Barcelona....Debarking is Athens.....So with Turkey canceled there's No Non EU ports

 

If I Prepurchase Excursions will I still be hit with the VAT tax during the cruise for them?? Or is VAT more for just tangible items?

 

How about per drink prices? We're not buying the cheers pkg as we have the free drink cards in the casino

 

Thanks for any help

[John Bull]

My question is this......Leaving on the Carnival Vista and Izmir Turkey port was canceled.......Embarking port is Barcelona....Debarking is Athens.....So with Turkey canceled there's No Non EU ports

 

If I Prepurchase Excursions will I still be hit with the VAT tax during the cruise for them?? Or is VAT more for just tangible items?

 

How about per drink prices? We're not buying the cheers pkg as we have the free drink cards in the casino

 

Thanks for any help

 

Usually excursions - like cruises - are classed as "transport" and are zero-rated for transportation for ten or more passengers. The same applies to included services like meals.

But if VAT applies, EU law requires that it is included in the ticket price - just like buying a beer or a sandwich ashore.

If your eyes have already glazed- over, put simply there'll be no excursion price increase due to that change of itinerary. :)

 

Charging of VAT on drinks sales is a bit of a minefield, & I can't answer that one.

But on free drinks cards?

12% of nothing = nothing. But the Spanish may read different maths books.:rolleyes:

 

JB :)

 

 

 

 

.

[LaCal]

Usually excursions - like cruises - are classed as "transport" and are zero-rated for transportation for ten or more passengers. The same applies to included services like meals.

But if VAT applies, EU law requires that it is included in the ticket price - just like buying a beer or a sandwich ashore.

If your eyes have already glazed- over, put simply there'll be no excursion price increase due to that change of itinerary. :)

 

Charging of VAT on drinks sales is a bit of a minefield, & I can't answer that one.

But on free drinks cards?

12% of nothing = nothing. But the Spanish may read different maths books.:rolleyes:

 

JB :)

 

 

 

 

.

 

Thanks JB. My main concern was excursions so that's a relief

[Bases5]

So since my cruise has a Non EU country (Montenegro) What does that mean for us as far as the VAT is concerned? We pay it every where but there?

 

 

Mon Oct 16 Barcelona, Spain 5:00pm

Tue Oct 17 Cannes, France 8:00am 7:00pm

Wed Oct 18 Florence / Pisa (Livorno), Italy 7:00am 7:00pm

Thu Oct 19 Rome (Civitavecchia), Italy 7:00am 7:00pm

Fri Oct 20 Salerno, Italy 7:00am 6:30pm

Sat Oct 21 At Sea

Sun Oct 22 Venice, Italy 3:00pm

Mon Oct 23 Venice, Italy 6:30pm

Tue Oct 24 Ravenna, Italy 7:00am 5:00pm

Wed Oct 25 Kotor, Montenegro 12:30pm 8:30pm

Thu Oct 26 At Sea

Fri Oct 27 At Sea

Sat Oct 28 Barcelona, Spain 6:00am

[Bobal]

So since my cruise has a Non EU country (Montenegro) What does that mean for us as far as the VAT is concerned? We pay it every where but there?

 

No, the cruise only has to have one port of call outside the EU and you won't incur the Spanish VAT charges for any purchases for the whole cruise.

 

What usually happens on Royal Caribbean is that if you make any purchases such as dining or drinks packages as soon as you board they will hold off putting the charges through until they have left Spanish waters. It's worth checking that they'll do this, or not purchasing until an hour or so after you set sail.

 

The only exception is that if you purchase a drink from the bar whilst you're still in Barcelona, before you set sail, I think that will incur Spanish VAT

Edited June 5, 2016 by Bobal

[abo]

Usually excursions - like cruises - are classed as "transport" and are zero-rated for transportation for ten or more passengers. The same applies to included services like meals.

But if VAT applies, EU law requires that it is included in the ticket price - just like buying a beer or a sandwich ashore.

If your eyes have already glazed- over, put simply there'll be no excursion price increase due to that change of itinerary. :)

 

Charging of VAT on drinks sales is a bit of a minefield, & I can't answer that one.

But on free drinks cards?

12% of nothing = nothing. But the Spanish may read different maths books.:rolleyes:

 

JB :)

 

 

 

 

.

 

 

That looks like the UK rates you are quoting, not Spanish. Transportation of passengers carries a reduced rate of 10% in Spain and varies between 0% and 25% across the EU.

 

However, the key point in this case is whether the purchase of the service takes place within the EU or outside. LaCal looks to be obviously resident outside the EU and I assume will be prepurchasing from RCCL in the US. In this case there is no sale in the EU and as this is a tax applied at point of sale within the EU there is no EU VAT to be calculated. This may be quite different for onboard sales.

Edited June 6, 2016 by abo

[Bases5]

No, the cruise only has to have one port of call outside the EU and you won't incur the Spanish VAT charges for any purchases for the whole cruise.

 

What usually happens on Royal Caribbean is that if you make any purchases such as dining or drinks packages as soon as you board they will hold off putting the charges through until they have left Spanish waters. It's worth checking that they'll do this, or not purchasing until an hour or so after you set sail.

 

The only exception is that if you purchase a drink from the bar whilst you're still in Barcelona, before you set sail, I think that will incur Spanish VAT

 

So I understand this.

If your cruise has a non EU port you will not have the VAT? on the ship

Does a one way or closed loop cruise makes a difference.

Edited June 6, 2016 by Bases5

[abo]

So I understand this.

If your cruise has a non EU port you will not have the VAT? on the ship

Does a one way or closed loop cruise makes a difference.

 

In principle:

10% Spanish IVA should be charged whilst in Spanish waters on drink, room services and speciality restaurants, regardless of whether the cruise goes to a non-eu port or not. In practice, cruiselines seek to find ways to avoid the need to pay this for example by closing shops and bars or taking "pre-orders" for drink packages as an example, but then actually selling this once in international waters. How RCL will handle this on your specific cruise is anyone's guess I'm afraid, but don't be surprised if you are charged 10% IVA/VAT on any drinks you buy whilst in port in Barcelona.

 

Other VAT should not be applicable to purchases on your cruise as you are leaving EU waters.

Edited June 6, 2016 by abo