New Italian tonnage tax regime risks local exodus

New Italian tonnage tax regime risks local exodus

Italy should brace itself for an exodus from its flag, with Malta likely to be a big winner. As Italy will soon have to amend its tonnage tax scheme in order to allow other EU flag ships to access the regime there is a serious risk of local owners departing. The regime basically allows for the determination of presumptive income based on the net tonnage of the qualifying ships apportioned to the effective shipping days (tonnage income). Last April the European Commission agreed to lengthen the tonnage tax until 2023, but asked Italy to cease its flag limit and make this same regime available also for other EU flag units.

Angelo D’Amato, ceo of Perseveranza di Navigazione and a member of the Italian shipowners association, speaking at an even held in Milan, said: “We have no choice on the matter. The European Commission imposes Italy to amend the regime and we have to do it. I don’t think there will be a big exodus of Italian shipping companies to other flags and neither a strong impact on national seafarers.” D’Amato added that “a flagging out of Italian ships has been underway from some years now but it’s for companies and debts restructuring, not for the tonnage tax regime that is still very convenient in Italy. All that said, it’s true that there are other flags such as Malta who are more competitive than Italy but mainly for administrative procedures and bureaucracy.” Some experts say that registering ships in Malta instead of in Italy can save a shipping company around $100,000 a ship.

The Italian seafarers’ unions are obviously in trouble with this development and Giovanni Olivieri, an official from Fit-Cisl, highlighted: “The updated tonnage tax regime might become an incentive for Italian shipping companies to register their ships under other EU flags putting at risk the work of thousands of seafarers.”

This subject will be one of the central matters due to be discussed at the next local shipowners association general assembly which will take place in Rome next Thursday.

 

 

Nicola Capuzzo

Nicola is a highly qualified journalist focused on transport economics, logistics and shipping with broad experience in both online and printed media. Specialties: shipping, ship finance, banking, commodities and port economics. He regularly interviews Europe's top shipowner executives for Maritime CEO magazine.

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