VAT on Mediterranean cruises?

[Asawi]

I stumbled upon a post on Facebook that claims that there is a 10% VAT added on everything on Mediterranean cruises. I trust this place a lot more than random FB posts, so I thought I'd better ask here about it. (Google only give me results that are several years old)

[KeithJenner]

There are various discussions here about this and other issues with purchasing alcohol in Europe. 
 

Id just review the first few pages of the message boards to see them. There is quite a bit of reading there. 🙂

[Asawi]

44 minutes ago, KeithJenner said:

There are various discussions here about this and other issues with purchasing alcohol in Europe. 
 

Id just review the first few pages of the message boards to see them. There is quite a bit of reading there. 🙂

There is quite a lot of reading here but I really didn't find an answer. My question is not really about alcohol or whether or not alcohol is served in ports. Nor is it about tax on alcohol in UK. Also, it's not about Spain. These topics I've read up on. I'm asking about the claim that 10% VAT is added to all purchases on Mediterranean cruises.

Maybe someone on a Mediterranean cruise at the moment can confirm or deny? Drinks on drinks packages?

Edited June 5, 2023 by Asawi

[insidecabin]

18 minutes ago, Asawi said:

There is quite a lot of reading here but I really didn't find an answer. My question is not really about alcohol or whether or not alcohol is served in ports. Nor is it about tax on alcohol in UK. Also, it's not about Spain. These topics I've read up on. I'm asking about the claim that 10% VAT is added to all purchases on Mediterranean cruises.

Maybe someone on a Mediterranean cruise at the moment can confirm or deny? Drinks on drinks packages?

 

Its way more complicated than "Mediterranean" it will depend on a number of factors starting with itinerary.

. 

[KeithJenner]

36 minutes ago, Asawi said:

There is quite a lot of reading here but I really didn't find an answer. My question is not really about alcohol or whether or not alcohol is served in ports. Nor is it about tax on alcohol in UK. Also, it's not about Spain. These topics I've read up on. I'm asking about the claim that 10% VAT is added to all purchases on Mediterranean cruises.

Maybe someone on a Mediterranean cruise at the moment can confirm or deny? Drinks on drinks packages?

As insidecabin says, it is more complicated than that.

 

Are you asking whether they are charged on all purchases, whether in port or not? If so then it really depends, as this only happens on cruises that don’t leave the EU and it also possibly depends on where you embark.

 

If you are talking about charges in port then this depends on the port.

 

There is not a yes/no answer to these questions and also just because something is happening this week it doesn’t mean it will be the same next week. Unfortunately you need to sift through the information.

 

The threads about this are not only about the UK or whether alcohol is served. There are quite a few discussions about the VAT issue as well.

[steamboats]

10% is the reduced VAT rate of Spain which applies to beverages or food. For other items like from the shops the rate is 21%. This applies to the whole cruise when it starts in a Spanish port and does not have a non EU port on the itinerary (then it´s just for the Spanish ports). It´s the same for cruises starting in Italy with no non EU port.

 

This is not a new thing but up for years now. While all other cruise line do not charge the VAT on a single beverage when you have bought a package NCL does charge it on every single beverage even when you have a package.  And yes, NCL is doing this for years too. So nothing new...

 

steamboats

[KeithJenner]

6 minutes ago, steamboats said:

10% is the reduced VAT rate of Spain which applies to beverages or food. For other items like from the shops the rate is 21%. This applies to the whole cruise when it starts in a Spanish port and does not have a non EU port on the itinerary (then it´s just for the Spanish ports). It´s the same for cruises starting in Italy with no non EU port.

 

This is not a new thing but up for years now. While all other cruise line do not charge the VAT on a single beverage when you have bought a package NCL does charge it on every single beverage even when you have a package.  And yes, NCL is doing this for years too. So nothing new...

 

steamboats

Charging people with the package hasn’t been consistent with NCL. We have cruised a few times with the package on all EU routes and never been charged the VAT. They have started and stopped doing it a few times over the years.

 

It seems to be more consistent lately though. There were grumbles on here about it last year and they seem to be doing it again now.

[Asawi]

7 minutes ago, steamboats said:

 NCL does charge it on every single beverage even when you have a package.  And yes, NCL is doing this for years too. 

Would that be 10% of list price (usually around $12)? (Rome to Venice, I think all EU. I'm not going on this cruise myself)

[KeithJenner]

7 minutes ago, Asawi said:

Would that be 10% of list price (usually around $12)? (Rome to Venice, I think all EU. I'm not going on this cruise myself)

When VAT is charged it is the percentage of the listed price, so your example sounds correct.

[podgeandrodge]

50 minutes ago, steamboats said:

10% is the reduced VAT rate of Spain which applies to beverages or food. For other items like from the shops the rate is 21%. This applies to the whole cruise when it starts in a Spanish port and does not have a non EU port on the itinerary (then it´s just for the Spanish ports). It´s the same for cruises starting in Italy with no non EU port.

 

This is not a new thing but up for years now. While all other cruise line do not charge the VAT on a single beverage when you have bought a package NCL does charge it on every single beverage even when you have a package.  And yes, NCL is doing this for years too. So nothing new...

 

steamboats

What about the Epic (and maybe more) cruises that "start" in Spain, but also Rome?  If you embark in Rome do you avoid the issue, I am guessing not!

[steamboats]

37 minutes ago, podgeandrodge said:

What about the Epic (and maybe more) cruises that "start" in Spain, but also Rome?  If you embark in Rome do you avoid the issue, I am guessing not!

 

No, as it´s the same for Italy (acutally it´s an EU regulation). It´s just a different rate (reduced 10%, full rate 22% for Italy).

 

steamboats

[steamboats]

1 hour ago, Asawi said:

Would that be 10% of list price (usually around $12)? (Rome to Venice, I think all EU. I'm not going on this cruise myself)

 

For a drink which is marked 12 USD on the bar menu it´s 1.20 USD VAT. Civitavecchia to Venice is pretty likely all EU ports (unless there´s a stop in Israel or Turkey or Egypt).

 

steamboats

[steamboats]

1 hour ago, KeithJenner said:

Charging people with the package hasn’t been consistent with NCL.

 

The only consistancy is the inconsistancy with NCL ;-).

 

It´s totally nonsense that there are "local laws" in Italy which don´t allow certain drinks to be offered in port (that´s what´s NCL is saying regarding Livorno). And I don´t know of any other cruise line which does not serve any alcoholic beverages in any UK port. MSC and AIDA are doing year round cruises out of Hamburg with interporting in Southampton and of course you can buy whatever drink you want (and they both don´t add any local tax or VAT when in port in Southampton).

 

Actually in Europe including UK we have to have all taxes/VAT included in the price tag. That´s the law. Therefore some cruise lines do have different bar menus for different regions (plus some do have different currencies like MSC which charges in USD in the Caribbean and in Euro in Europe).

 

steamboats

[insidecabin]

5 minutes ago, steamboats said:

 

.........

Therefore some cruise lines do have different bar menus for different regions (plus some do have different currencies like MSC which charges in USD in the Caribbean and in Euro in Europe).

 

steamboats

And GBP(with no extra service) when they homeport in Southampton from April to Nov, exact dates vary.

[KeithJenner]

12 minutes ago, steamboats said:

 

The only consistancy is the inconsistancy with NCL ;-).

 

It´s totally nonsense that there are "local laws" in Italy which don´t allow certain drinks to be offered in port (that´s what´s NCL is saying regarding Livorno). And I don´t know of any other cruise line which does not serve any alcoholic beverages in any UK port. MSC and AIDA are doing year round cruises out of Hamburg with interporting in Southampton and of course you can buy whatever drink you want (and they both don´t add any local tax or VAT when in port in Southampton).

 

Actually in Europe including UK we have to have all taxes/VAT included in the price tag. That´s the law. Therefore some cruise lines do have different bar menus for different regions (plus some do have different currencies like MSC which charges in USD in the Caribbean and in Euro in Europe).

 

steamboats

I don’t disagree with a word of that.

 

To be clear, I was just saying how it is on NCL. I’m making no comment at all on how it should be (other than that NCL should be consistent but seem incapable of being so).

 

You will find from previous postings that I am very critical of NCLs handling of these issues.

[zelliott]

I’ve seen a few of these topics, but I haven’t seen anyone mention VAT for the entire cruise when departing from Portugal but remaining in the EU. I’m guessing that means it doesn’t happen, but if anyone happens to have first-hand experience, I’d be glad to know what it is!

[KeithJenner]

3 minutes ago, zelliott said:

I’ve seen a few of these topics, but I haven’t seen anyone mention VAT for the entire cruise when departing from Portugal but remaining in the EU. I’m guessing that means it doesn’t happen, but if anyone happens to have first-hand experience, I’d be glad to know what it is!

Some cruises from Lisbon stop off at Gilbaltar, which is not EU, so this may explain it.

 

This is why I say that it is so unclear though. It does seem to depend on the port of embarkation as well.

 

Another anomoly at the moment seems to be some round trips from Rome to the Greek Islands that don’t seem to leave the EU, but I’ve not seen any mention of tax being charged for the entire cruise (although I may have missed it).

[DrUrsula]

1 hour ago, podgeandrodge said:

What about the Epic (and maybe more) cruises that "start" in Spain, but also Rome?  If you embark in Rome do you avoid the issue, I am guessing not!

We embarked in Rome and paid no additional VAT. All had drink package. We were on Epic Italy/France/Spain.

[ontheweb]

4 hours ago, podgeandrodge said:

What about the Epic (and maybe more) cruises that "start" in Spain, but also Rome?  If you embark in Rome do you avoid the issue, I am guessing not!

When we sailed on the Epic from Barcelona, it also sailed from Rome and a port in France, I think Marseilles. I do no remember being charged VAT, but that was in 2012, so things may very well have changed.

[steamboats]

4 hours ago, DrUrsula said:

We embarked in Rome and paid no additional VAT. All had drink package. We were on Epic Italy/France/Spain.

 

Although it was Vista (Oceania Cruises) out of Civitavecchia we did get a notice that all purchases in the shops will have the Italian VAT added. And this was just three weeks ago. No VAT on drinks but that was the christening cruise with open bar.

 

steamboats

[Greener123]

On 6/5/2023 at 1:34 PM, KeithJenner said:

Some cruises from Lisbon stop off at Gilbaltar, which is not EU, so this may explain it.

 

This is why I say that it is so unclear though. It does seem to depend on the port of embarkation as well.

 

Another anomoly at the moment seems to be some round trips from Rome to the Greek Islands that don’t seem to leave the EU, but I’ve not seen any mention of tax being charged for the entire cruise (although I may have missed it).

This is what I was thinking, I’ve only seen the extra VAT being mentioned on cruises embarking from Spain. 

[graphicguy]

I was talking to a TA last night and asked about the VAT charged in Europe on drinks.  She seemed quite knowledgeable and has been working in the industry for a while.  She said there's a difference between pre-purchasing a drink package (which Free at Sea would qualify because it's applied to your cruise before you board).  And, buying drinks a la carte once on board, which is subject to the taxes.

 

It's an accounting process given drinks under the drink packages are not considered  "point of sale" since the sale was made when you booked your fare.

 

Packages or drinks sold once you're on board ARE a point of sale item(s) and subject to the taxes.

 

Free at Sea is a pre-board item.  Any taxes or fees broken out are simply line items of the package.  Anyone buying a package or drinks on board in parts of Europe (subject to local regulations) either have the fees/taxes baked into the cost, with no breakout.  Or, in NCL's case, those line items are shown separately.  Whether they can or can't break out those line items is a matter of debate.  But, since not everyone has Free at Sea, it gets jumbled.

 

This extends to any gift shop or other store purchases....all point of sale items.

 

This makes total sense.  

 

Edited June 6, 2023 by graphicguy

[Asawi]

24 minutes ago, graphicguy said:

 

This makes total sense.  

 

Yes, this absolutely makes total sense! 

[insidecabin]

1 hour ago, graphicguy said:

I was talking to a TA last night and asked about the VAT charged in Europe on drinks.  She seemed quite knowledgeable and has been working in the industry for a while.  She said there's a difference between pre-purchasing a drink package (which Free at Sea would qualify because it's applied to your cruise before you board).  And, buying drinks a la carte once on board, which is subject to the taxes.

 

It's an accounting process given drinks under the drink packages are not considered  "point of sale" since the sale was made when you booked your fare.

 

Packages or drinks sold once you're on board ARE a point of sale item(s) and subject to the taxes.

 

Free at Sea is a pre-board item.  Any taxes or fees broken out are simply line items of the package.  Anyone buying a package or drinks on board in parts of Europe (subject to local regulations) either have the fees/taxes baked into the cost, with no breakout.  Or, in NCL's case, those line items are shown separately.  Whether they can or can't break out those line items is a matter of debate.  But, since not everyone has Free at Sea, it gets jumbled.

 

This extends to any gift shop or other store purchases....all point of sale items.

 

This makes total sense.  

 

Not if the taxes are actually charged to those on any pre purchase package.

 

Any prepaid package is the equivalent of a proper all inclusive cruise line like Regent.

[Norwayfan1]

20 minutes ago, insidecabin said:

Not if the taxes are actually charged to those on any pre purchase package.

 

Any prepaid package is the equivalent of a proper all inclusive cruise line like Regent.

Yes, it made no sense to me that NCL were charging Spanish tax for a full three days on the notional price of drinks covered by the pre-paid drinks package, on Norwegian Star last autumn. We had done a similar cruise with Celebrity just a few weeks earlier, when the only Celebrity fare available was 'Always Included' (ie drinks package part of the cruise fare). No such taxes were collected then; both cruises sailed from Southampton. I do think that was probably an error on NCL's part (and maybe still is).