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Portugal adopted new tonnage tax law

Last Friday the Portuguese parliament has passed a new law on the introduction of tonnage tax in Portugal. This ensures to build on the country’s maritime industry. The Portuguese government has plans for a comprehensive development of the entire maritime industry. This includes shipping, maritime labour, infrastructure and maritime supplieers. This is in line with the adopted law, which aims to make Portugal the home of new shipping companies by very attractive conditions. The advantages of the new Portuguese tonnage tax at a glance:

  • Tonnage tax rate (per 100 NT per operating day / taxable profit to be calculated by vessel size
    in NT)
    o 0,70 Euro first 1,000 NT
    o 0,60 Euro 1,001 to 10,000 NT
    o 0,40 Euro 10,001 to 25,000 NT
    o 0,20 Euro above 25,000 NT
  • Ship ownership or ship management must take place in Portugal (strategically and commercially managed from the EU)
  • If the tonnage tax applies, it is obligatory to fly an EU/EEA flag (60 per cent of a fleet minimum, to comply with EU rules)
  • Incentives for in particular environmental friendly ships
  • Period to opt for tonnage tax minimum five years
  • Law will enter into force retroactively by 01 January 2018

Robert Lorenz Meyer, President of the European and International Shipowners Association of Portugal, (EISAP), assured “the current adoption of tonnage tax in Portugal is a milestone for European shipping. After the founding of the high-quality Madeira registry, this step was logical and constistent. We are sure that there will be even further development. As soon as the announced law for maritime security forces for ships is passed, Portugal will become an even more attractive location. Portugal is playing an active role to further improve the location as one of the most important European shipping markets – also as alternative after Brexit.“ Tonnage tax means tonnage profit determination for companies that generate their income mainly from the operation of merchant vessels. For a fixed period of time, ship owners can opt for a year by year flat taxable profit instead of the conventional profit/loss calculation method.

Source: European and International Shipowners Association of Portugal (EISAP)

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