10% Spanish VAT on bar charges at NCL ?

NCL charge Spanish 10% VAT on 'bar-purchases' ( regardless of drink-package purchased or not ) while ship is less than 12 miles from Spain, which is more or less all the time on a cruise Barcelona > Morocco > Canary Islands, Málaga, Alicante > Barcelona.

:')

I've been on other cruises from / to Spanish ports and never seen this before.

Anyone know if other lines simply 'eat' this, or if it's a new trend to look out for the 12 mile distance.

> just off NCL Spirit <

I very much doubt that other lines with absorb this charge. Why should they?

The issue is with what other countries are visited, not really the distance from Spain. Most other cruise lines make sure they visit countries that exempt the ship from the VAT.

I looked for, but couldn't find, a recent discussion of this. I think the requirement is if you end at another EU port, but stop some place outside of the EU, you are exempt from the VAT. Something like that.

An excellent question is asked, though...why should they just eat a 10% tax? Not a good business idea.

 

I've been on other cruises from / to Spanish ports and never seen this before.

Anyone know if other lines simply 'eat' this, or if it's a new trend to look out for the 12 mile distance.

Whilst CL can’t avoid taxation laws, it’s very clear also they don’t understand or more probable are using it to confuse and make higher profits.

The tax is applicable to purchases made and on the purchase price. If you have already purchased your drinks in a package prior to boarding, then in exactly the same and reason, no tax is applied to food (which would be the same as alcohol).

It doesn’t matter the drink ordered has a value of $10. It’s cost you zero as it’s pre paid. There should be zero Tax.

Any drinks you physically buy that has a cost (ie you haven’t pre-paid) then that tax is not avoidable.

I can’t help think CL are probably making sure that they *dont* chose non EU ports so they can exploit peoples ignorance on taxation laws.

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I very much doubt that other lines with absorb this charge. Why should they?

Well, simply a matter of phrasing their expenses of selling 'a drink'

They obviously make a lot of money and have very little expense on the drinks.

On any ship you pay like $ 12-14 for a drink. We don't really know how much of this is expense to purchase product, transport, tax etc etc. . . not that it matters. They have set a price and have a profit . . . fair enough - I just haven't encountered this before. Have been on 12 or 13 cruises in the Med over the past 10 years with different lines, and itineraries, most of them with Spanish ports included. Spain being a EU country it should not be different from other Med countries either, ( Portugal, France, Italy, Greece ).

At some cruises I have had 'drink package' at others just paid per drink. . . . and simply wonder if anyone know that something has changed.

:)

Whilst CL can’t avoid taxation laws, it’s very clear also they don’t understand or more probable are using it to confuse and make higher profits.

 

The tax is applicable to purchases made and on the purchase price. If you have already purchased your drinks in a package prior to boarding, then in exactly the same and reason, no tax is applied to food (which would be the same as alcohol).

 

It doesn’t matter the drink ordered has a value of $10. It’s cost you zero as it’s pre paid. There should be zero Tax.

 

Any drinks you physically buy that has a cost (ie you haven’t pre-paid) then that tax is not avoidable.

 

I can’t help think CL are probably making sure that they *dont* chose non EU ports so they can exploit peoples ignorance on taxation laws.

 

 

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Yes, well . . . it's not really people's ignorance . . .

A passenger don't have a choice. Pay 10% of the price list 'value' of the drink, or you don't get it. There's no way around it. Bar staff have to follow the rules - they say it's mandatory. . . . this 105 comes on automatically when they run a drink item thru the 'cash register' - You can't win . . . but you can wait until 12 miles out and there will be no tax.

Yes, well . . . it's not really people's ignorance . . .

 

A passenger don't have a choice. Pay 10% of the price list 'value' of the drink, or you don't get it. There's no way around it. Bar staff have to follow the rules - they say it's mandatory. . . . this 105 comes on automatically when they run a drink item thru the 'cash register' - You can't win . . . but you can wait until 12 miles out and there will be no tax.

Can you work out what 10% of $0.00 is?

The cost of your pre-paid drink is $0.00 - exactly the same as your food charges - because its pre-paid. Its irrelivant that a drink can be physically bought by someone without a drink package and a red herring.

The VAT on restaurant food is also 10% in Spain......I'm sure you will agree that the food you get served has a real value above $0.00 .....

As for waiting until you are 12 miles out to sea and avoid paying tax on your drinks package or otherwise is also not true or being applied unless your cruise ship has a port of call outside of the EU. Then a purchase of booze or food in the port where money changes hands will be charged but outside the port, will become VAT free in those circumstances. You may be right the passenger doesnt have the choice...... but I'm saying it shouldnt be the case if you have prepaid for a drinks package in your home country. The CL are conning you by doing so.

It's well-known that Spain applies the tax in Spanish waters, and cruise-long on itineraries which start in Spain & call only at EU ports. As Bruce has pointed out, its one reason why cruise lines usually include a non-EU port such as Gibraltar, Turkey, Guernsey, and - since Croatia joined the EU - Albania.

There have been similar examples on some, but not all, similarly EU-only cruises out of Italy and the UK. And since it's to do with EU law it should be the same EU-wide - if local tax should be applied in Spanish waters then local tax should be applied in the home waters of those other EU countries. But it isn't. Such is the bureaucracy of the EU that different countries - mebbe even different bureaucrats - interpret the law in different ways. :rolleyes:

But Spain is the culprit, not NCL.

A saving grace on this cruise is that it includes both Morocco and the Canary Islands, neither of which are in the EU customs union.

I'm sure you already knew that Morocco isn't in the EU - hellfire it isn't even in the European continent :D

But one of the complications of the EU is that although the Canaries are part of Spain, they're not part of the EU customs union. So Spanish tax doesn't apply in the Canaries.

(That's the same as Gib and the Channel Islands - both are part of the UK & the EU but not part of the customs / tax regime of either).

So for most of your cruise there'll be no Spanish VAT.

Smokes & alcohol will be cheap in the Canaries. And probably cheap in Morocco.

I wasn't aware of the tax being applied to drinks packages - that'll be fun for some poor soul behind the bar to have to work out with a watch and a GPS :D

JB :)

ps I'm no expert on EU VAT. I'm only expert at knowing that it's complex.:confused:

I

I wasn't aware of the tax being applied to drinks packages - that'll be fun for some poor soul behind the bar to have to work out with a watch and a GPS :D

Thats the thing John, it shouldnt be applied (apart from those actually buying a drinks package once they get on board - then the drinks package itself gets hit with VAT - but Not individual drinks obtained as they have already been bought.)

And leaving Spanish waters become irrelivant if the ship doesnt leave EU waters.... Legally they have to charge VAT at the rate of 10% for drinks *purchased* for every drink - apart from when the ship goes into another port and that countries tax takes over for the duration of the stop.... it then reverts to Spanish tax back outside the port. Obviously this is only for a cruise starting from Spain and not visiting a non EU port as youve said.

They should only be charging a tax on the physical sum of money being paid. So if you have pre-paid for your drinks, there should be NO tax regardless of where its obtained. I was on Carnival Vista last year and prepaid.... I was lucky and the only cruise they actually got the taxes to be charged correct. I dont get any of this nonsense on Silversea... all drinks are tax free and without charge regardless of starting from Spain and not leaving the EU, which is how it should be.

It's no good telling me, Les. ;)

Write to :

Jean-Claude Juncker,

President,

European Commission,

Eurocracy Tower,

Brussels

It may take a year or three to get a response, but no need to worry that he'll lose his presidency in the meantime - he's an un-elected appointee. :rolleyes:

The above in jest

Probably.;)

BTW, alcohol doesn't equate to food. In the EU cruising is classed as "transport", which is tax-free. And food & board are counted as part of that transport. But not alcohol.

And, with respect, where / when you pay for something doesn't come into it.

For instance when I book a rental car, hotel, etc - in the EU and in the US and anywhere else - I pay local taxes even though I pay in advance from the UK.

And think about it - if pre-paying from another country avoided tax we'd all be paying up-front from a different country for everything worth the effort - house, cars, expensive jewellery etc.

NCL are perhaps remiss in one respect. By law, EU tax must be included in the price quoted to the consumer. So if ashore you buy a beer, a meal, something in the shops, etc, the tax is included in the sticker price. So NCL should be up-front about Spanish tax on shipboard prices - though I seem to recall seeing something about it on a website of theirs.

JB :)

It's no good telling me, Les. ;)

 

Write to :

Jean-Claude Juncker,

President,

European Commission,

Eurocracy Tower,

Brussels

 

It may take a year or three to get a response, but no need to worry that he'll lose his presidency in the meantime - he's an un-elected appointee. :rolleyes:

 

The above in jest

Probably.;)

 

BTW, alcohol doesn't equate to food. In the EU cruising is classed as "transport", which is tax-free. And food & board are counted as part of that transport. But not alcohol.

 

And, with respect, where / when you pay for something doesn't come into it.

For instance when I book a rental car, hotel, etc - in the EU and in the US and anywhere else - I pay local taxes even though I pay in advance from the UK.

And think about it - if pre-paying from another country avoided tax we'd all be paying up-front from a different country for everything worth the effort - house, cars, expensive jewellery etc.

 

NCL are perhaps remiss in one respect. By law, EU tax must be included in the price quoted to the consumer. So if ashore you buy a beer, a meal, something in the shops, etc, the tax is included in the sticker price. So NCL should be up-front about Spanish tax on shipboard prices - though I seem to recall seeing something about it on a website of theirs.

 

JB :)

I hear what you say re food being treated as part of the fare, though its also true food purchased on board WILL be subject to tax - so even more clouding of the rules. And you were right in what you were saying earlier that its the Spanish that have kicked this all off. Still. Look on the bright side. 10% in Spain is better than 20% in the UK, 21% Italy and 24% for Greece!

I'm very sure passengers would be more selective in what they booked if they were made aware. I know I would avoid an EU only cruise starting in Greece on a CL who thought you could charge VAT on a drink already paid for.

Not sure I agree with what youve said about paying for car hire. I know Ive prepaid for US car hire and not paid a penny when Ive arrived. And similarly, if you buy a drink package, you should only ever have to be considered for paying VAT on the daily rate - not on each drink you have.

I hear what you say re food being treated as part of the fare, though its also true food purchased on board WILL be subject to tax - so even more clouding of the rules. And you were right in what you were saying earlier that its the Spanish that have kicked this all off. Still. Look on the bright side. 10% in Spain is better than 20% in the UK, 21% Italy and 24% for Greece!

 

I'm very sure passengers would be more selective in what they booked if they were made aware. I know I would avoid an EU only cruise starting in Greece on a CL who thought you could charge VAT on a drink already paid for.

 

Not sure I agree with what youve said about paying for car hire. I know Ive prepaid for US car hire and not paid a penny when Ive arrived. And similarly, if you buy a drink package, you should only ever have to be considered for paying VAT on the daily rate - not on each drink you have.

I think probably whereas included food is part of the transport deal, premium restaurants would be treated as optional, & VATable same as restaurants ashore.

Don't remind me that we pay 20% in the UK. :D

If the Greek govt applied the rules the same way as the Spanish - yes, you'd be right. But I've not heard the same complaints about Greek departures. Taxes aren't their forte ;)

Re car rentals, I don't pay taxes on arrival - they're in the up-front payment, and itemised.

Not having cruised EU-only out of Spain I don't know how they apply the tax on packages. Surely not on the daily rate cos many days a part of a day will be in Spanish waters. Wouldn't a per-order basis be cheaper?

Chin up. Worse things happen at sea ;p

JB :)

I think probably whereas included food is part of the transport deal, premium restaurants would be treated as optional, & VATable same as restaurants ashore.

 

Don't remind me that we pay 20% in the UK. :D

If the Greek govt applied the rules the same way as the Spanish - yes, you'd be right. But I've not heard the same complaints about Greek departures. Taxes aren't their forte ;)

 

Re car rentals, I don't pay taxes on arrival - they're in the up-front payment, and itemised.

 

Not having cruised EU-only out of Spain I don't know how they apply the tax on packages. Surely not on the daily rate cos many days a part of a day will be in Spanish waters. Wouldn't a per-order basis be cheaper?

 

Chin up. Worse things happen at sea ;p

 

JB :)

The Carnival Vista cruises a year ago, were charging people 24%. I agree the Greeks are not well known for collecting taxes..... but its not them collecting! (And I do firmly believe the money being collected "per drink" from those who had paid in advance for a drinks package, went nowhere near the intended recipient it was allegedly collected for.

The cruise I was on was out and back to Barcelona. Carnival didn't charge me individual drink tax or try to apply a tax to the pre paid daily amount. Those who paid were charged VAT on that purchase which is the correct thing to do. In EU only cruises, its treated as being in the starting countries waters everywhere apart from in port in another country and taxes are then charged at the rates for those countries.

On cruises before mine, they were charging per drink even on those with a drinks package which is BS since a tax is a % rate on the price youve paid. After my cruise they stopped selling drinks packages altogether. I expect there would be an awful lot of unhappy punters.

John, it’s just dawned on me that the cruise I mentioned I was on and were treated properly by Carnival with respect to taxation and the drinks package I’d pre booked, people who had to purchase drinks were charged at 21% instead of 10% even though the cruise was out and back to Barcelona. (21% is the “normal” Spanish VAT rate instead of the 10% “restaurant” rate.

I know friends we made on the cruise we’re just brushed aside both on the cruise and after when they complained about it. And you can bet your last dollar that Carnival did not hand their fraudulent charges to the taxman.

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Complicated, innit, Les :confused:

I'm surprised to hear about Carnival & its 24% Greek tax cos there are many threads similar to this one about Spanish tax, but this is the first I've heard of ditto in Greece.

Mebbe a one-off interpretation of the rules that got rescinded in the face of complaints.

Ditto 21% on cruises ex-Spain :confused:.

10% on alcohol sales in bars & restaurants according to the rules, and 10% according to every post I've seen on Cruise Critic.

The confusion isn't helped by cruisers' dodgy memories & maths.

I know that some have clearly gotten mixed-up between tax and the cruise lines' service charges, or treated that total as all tax.

And one who claimed to have been charged Spanish tax on drinks he bought all the way back to Florida.:rolleyes:

The confusion is enough to turn a guy teetotal :eek:

Well mebbe not - that's a bit too extreme :D

JB :)

John, I appreciate it wasn’t a challenge, but here is a link asking in a relevant thread why our 26 August 2016 Barcelona to Barcelona was being charged at 21% yet subsequent cruises charged at 10%. .... the question was to someone calling themselves Karnyval and blatantly an employee... That question was in support of “Harry” who is someone we chatted with prior to the cruise, travelled on several trips with them and evening on board that cruise.

https://boards.cruisecritic.co.uk/showpost.php?p=51133839&postcount=27

Carnival refused to refund and insisted they were correct....when you are that brazen about it, it’s not surprising people actually believe them.

This VAT problem was a massive talking point in threads at a the time.... including the roll call..... and I’m certain I know exactly who it was hiding behind that username. It’s one of the reasons I do remember it so well... no mix ups.

That same thread incidentally was started by a user complaining about just learning his Greek Vista cruise was being hit with a 24% VAT charge.

https://boards.cruisecritic.co.uk/showthread.php?t=2401715

Now you’ve seen 24% Greek VAT cruises and Spanish 21% starters for booze.

One thing I will add..... carnival did NOT stop passengers coming on board with booze..... again something most unusual

Les,

The first link led nowhere.

The other one, I can see reason and I can see irrational.

Greece to Greece including EU countries and Turkey is fine.

But by cancelling the Turkish port it seems the rule is to apply Greek VAT throughout.

Unpalatable, but the same rule as applied by the Spanish.

That's what comes of excessive (IMHO) caution re terrorism.

But changing the rate of VAT as the ship moves from one EU country to another?

(re Spain to Greece).

Sounds nonsensical.

No itinerary quoted but surely the ship called elsewhere en-route - France? Italy? Malta?

The links to Greek govt pages are pointless, these are huge wdebsites & no hint where to find the relevant info.

The link to Carnival's answer is "no longer available" I'm not surprised.:rolleyes:

Harry seems to know what he's talking about, tho I suspect he's wrong about buying in one EU country & consuming in another. Full circle re my comment about rental cars, hotels, etc.

And I'll refer you back to my original post-script - I'm only expert at knowing that it's complex.:eek:

I'll content myself with ensuring that I don't book an EU-only cruise.

Soon that'll be guaranteed with any sailing out of the UK :)

JB :)

We were on Spirit last year with a pre-purchased drinks package and did not pay any tax. There was a similar thread running recently which I cannot track down now. On there it was said that NCL have only started to charge this tax within the last three or four months. I wonder if any of that ever finds its way to the tax man!

We were on Spirit last year with a pre-purchased drinks package and did not pay any tax. There was a similar thread running recently which I cannot track down now. On there it was said that NCL have only started to charge this tax within the last three or four months. I wonder if any of that ever finds its way to the tax man!

For actual purchases made on the ship, I expect the receipts and taxes due are paid in full. I have the greatest suspicion that this little ruse on pre-paid drinks packages attracting this imaginary "what it would have cost you" tax, is a money spinner for which you are unable to challenge and get the response "don't blame us". It shouldn't be charged its as simple as that. The drink you obtain is free whilst on the ship because its already paid for. What next? The "Ah but you could have had" tax chargeable because its not their fault you chose not to abuse your drinks package!

Whats even worse is they (as Monty Python would say) are making it up as they go along and without informing people when booking so they can make informed choices.

Les,

 

The first link led nowhere.

 

The other one, I can see reason and I can see irrational.

 

Greece to Greece including EU countries and Turkey is fine.

But by cancelling the Turkish port it seems the rule is to apply Greek VAT throughout.

Unpalatable, but the same rule as applied by the Spanish.

That's what comes of excessive (IMHO) caution re terrorism.

 

I agree - I posted the details as you'd said you'd never seen this VAT issue in any Med cruise apart from a Spanish starter.

But changing the rate of VAT as the ship moves from one EU country to another?

(re Spain to Greece).

Sounds nonsensical.

No itinerary quoted but surely the ship called elsewhere en-route - France? Italy? Malta?

Actually, whilst its a pain, I can completely understand why its done. Why would drinks served, bought and paid for when the ship was in Italy serve to raise taxes for Spain? Its only whilst in port this change is applicable. The rate remains constant apart from that (ie the rate applicable for the country of departure.

It is a mess though I concur..... and yes I also agree its the Spanish who have kicked this into motion.

The links to Greek govt pages are pointless, these are huge wdebsites & no hint where to find the relevant info.

 

The link to Carnival's answer is "no longer available" I'm not surprised.:rolleyes:

That link was included in the post I had linked to and responded to in post 17 of that thread. The person you are referring to posting those links to Greek and Carnival sites is by the person I believe is a Carnival employee. (So many of the things being posted at the time and replicated on a certain cruise directors blog made it very obvious who it was.)

Harry seems to know what he's talking about, tho I suspect he's wrong about buying in one EU country & consuming in another. Full circle re my comment about rental cars, hotels, etc.

At the time, there were lots of threads being posted and a huge uproar. When you are due to be sailing or just sailed its a big eye opener. Post 34 refers to threads disappearing and further in that same thread its spelt out that different rates were being applied (post 34) and passengers being charged tax on drinks with a value on zero obtained under drinks packages pre-paid. As Ive said, mine was the ONLY cruise Carnival got the pre-paid drinks tax situation correct. For the whole of the Vista season in the Med was full of comical (and expensive for the guest) "mistakes". I use the word "mistake" loosely.

Harry never got his money back (or anyone else I suspect) for being charged 21% for drinks purchased on a cruise out and back to Barcelona which had stops in Italy and France only.

In short, they were charged the "full" Spanish taxation rate, despite previous cruises and subsequent cruises, getting the rate from drinks purchased on board at the food and restaurant Spanish tax rate of 10%

I'll refer you back to my original post-script - I'm only expert at knowing that it's complex.:eek:

 

I'll content myself with ensuring that I don't book an EU-only cruise.

Soon that'll be guaranteed with any sailing out of the UK :)

 

JB :)

It is a mine field for sure, though there is no excuse for refusing to pay back money taken "in error". For the very reason you describe, I also will make sure I don't do an EU only cruise unless using a reputable CL....... and look forward to UK starts too.

It's well-known that Spain applies the tax in Spanish waters, and cruise-long on itineraries which start in Spain & call only at EU ports. As Bruce has pointed out, its one reason why cruise lines usually include a non-EU port such as Gibraltar, Turkey, Guernsey, and - since Croatia joined the EU - Albania.

 

There have been similar examples on some, but not all, similarly EU-only cruises out of Italy and the UK. And since it's to do with EU law it should be the same EU-wide - if local tax should be applied in Spanish waters then local tax should be applied in the home waters of those other EU countries. But it isn't. Such is the bureaucracy of the EU that different countries - mebbe even different bureaucrats - interpret the law in different ways. :rolleyes:

But Spain is the culprit, not NCL.

 

A saving grace on this cruise is that it includes both Morocco and the Canary Islands, neither of which are in the EU customs union.

I'm sure you already knew that Morocco isn't in the EU - hellfire it isn't even in the European continent :D

But one of the complications of the EU is that although the Canaries are part of Spain, they're not part of the EU customs union. So Spanish tax doesn't apply in the Canaries.

(That's the same as Gib and the Channel Islands - both are part of the UK & the EU but not part of the customs / tax regime of either).

So for most of your cruise there'll be no Spanish VAT.

 

Smokes & alcohol will be cheap in the Canaries. And probably cheap in Morocco.

 

I wasn't aware of the tax being applied to drinks packages - that'll be fun for some poor soul behind the bar to have to work out with a watch and a GPS :D

 

JB :)

ps I'm no expert on EU VAT. I'm only expert at knowing that it's complex.:confused:

I have just returned from a 10 day Canary Islands cruise ion NCL spirit and we were charged VAT in all Spanish ports including the Canary Islands and the full length of the Gibralter border Our total VAT charges for 10 days $43, there were so many complaints

I have just returned from a 10 day Canary Islands cruise ion NCL spirit and we were charged VAT in all Spanish ports including the Canary Islands and the full length of the Gibralter border Our total VAT charges for 10 days $43, there were so many complaints

That sounds so very very wrong, and I'm not surprised there were complaints :mad:

Everyone knows that Gib is outside the EU customs union.

And there's no VAT in the Canaries - altho' part of Spain they're outside both the Spanish VAT regime and the EU customs union, one reason why they're a popular destination for Brits. And for Brit fly-cruises - we sailed the Canaries in December (not NCL), starting & finishing in Tenerife and including the Portuguese island of Madeira (which is in the EU customs union), and we were not charged VAT except for purchases ashore in Madeira. And that's the way it should be. .

These threads almost always seem to be about NCL.

Do they really know what they're doing? :confused:

JB :)

Not just NCL John. Carnival completely made a hash in 2016 on Vista and were completely dishonest as the link I posted above shows.

It seems it’s all to easy to blame the pesky EU and then make extra on the side by taking money they are not entitled too. Carnival 100% did this and it’s seems NCL are also.

You loose all respect for operators for doing this. I still can’t believe Carnival invented the “what it would have cost you tax” to those having “free” drinks in their drinks package. So much for them declaring “pay in full and no unpleasant surprises”!

That sounds so very very wrong, and I'm not surprised there were complaints :mad:

 

Everyone knows that Gib is outside the EU customs union.

 

And there's no VAT in the Canaries - altho' part of Spain they're outside both the Spanish VAT regime and the EU customs union, one reason why they're a popular destination for Brits. And for Brit fly-cruises - we sailed the Canaries in December (not NCL), starting & finishing in Tenerife and including the Portuguese island of Madeira (which is in the EU customs union), and we were not charged VAT except for purchases ashore in Madeira. And that's the way it should be. .

 

 

These threads almost always seem to be about NCL.

Do they really know what they're doing? :confused:

 

JB :)

If it's to do with the 12 mile limit, then that covers both Gibraltar and Morocco. We're charged the VAT when in a Spanish dock, on UK managed ships, and up to 12 miles out- (though in reality I'm not sure that that does happen up to 12 miles ;)) It's always clearly marked on the receipt.