British boaters face a choice between extra costs rising into four figures or seeing their vessels being stranded in the EU after the end of the Brexit transition period, unless the UK Government acts now.
That was the warning in a joint statement issued yesterday (Thursday 1 October) by the RYA and British Marine, which castigated Whitehall officials for failing to provide guidance and transitional arrangements despite the mater being raised more than three years ago.
The two organisations say their understanding is that Returned Goods Relief (RGR) will only be available for goods returning to the UK provided RGR conditions are met, and that the goods must have been exported from the UK and returned within three years of export.
RGR has not yet been incorporated into UK law and HM Revenue and Customs confirmed last month, after what the RYA and British Marine said was “an unacceptable delay”, that it “would not in fact be universally available”.
This will mean that, after the transition period, all boat owners established in the UK whose boats have not been in the UK in the last three years will likely have to pay VAT for a second time if they want to bring their boats back to UK waters.
The same issue will also “create turmoil” in the UK’s second-hand boat market, which is already fighting to recover from the coronavirus pandemic.
RYA and British Marine are now calling on the UK Government to commit to transitional VAT and import duty relief for UK boat owners bringing vessels back from the EU until the end of 2023.
“Having waited over a year for HMRC to agree to a meeting, we assumed that HMRC officials would be in a position to definitively tell us what the UK legislation will be from the end of the transition period on 31 December,” said the RYA’s Howard Pridding.
“Regrettably, the meeting gave the RYA and British Marine no confidence that there is an understanding of the recreational boating market and that any of the issues we have raised are being given appropriate consideration by HMRC.”
British Marine chief executive Lesley Robinson added: “This is now a serious situation and it will create turmoil in the second-hand boat market. For UK brokers and distributors in the marine industry there remains doubt and confusion as to where they stand.
“There is a high probability that current VAT-paid boats (that will no longer have EU27 VAT-paid status after Brexit) will be devalued and become less attractive to buyers, which will impact businesses and ultimately jobs in the industry.”
