Got UBP as a perk/promo - Will I be charged 18% on each drink?

[insanemagnet]

No.

 

I'm done.

 

I'm not going round in circles.

 

I don't work for NCL. I don't make the rules. I don't know how they justify it. Find out for yourself.

 

Neither do NCL. NCL have no choice but to apply the EU VAT rules correctly, but it would appear from your posts that they are not doing so.

 

You mention "accounting" to justify NCL's actions, but don't want to explain how "accounting" creates a taxable amount (as required by Article 73) if there is the be an amount of VAT. So your explanation why NCL should charge VAT, is because they charge an American tax when sailing down the Mississippi. Hmmm.

 

Quite simply, NCL cannot justify charging VAT on any promo UBP.

[SteveH2508]

To insanemagnet

 

As I pointed out on another thread - you seem to have a fundamental misunderstanding of how VAT works.

 

VAT becomes payable on the value of the item at the time it is supplied (the clue is in the name Value Added Tax). Whether you have pre-paid for it with a UBP; paid cash at the time, or pay for it when you disembark is irrelevant. When in e.g. Spanish territorial waters, or on a closed EU cruise you will pay VAT on drinks. End of.

 

It is a criminal offence to charge VAT when it is not due; it is counter-productive for NCL to charge VAT when it is not legally required; why should they charge it when they do not absolutely have to?

 

Take your tin hat off and think rationally about this.

Edited April 6, 2015 by SteveH2508

[insanemagnet]

VAT becomes payable on the value of the item at the time it is supplied. Whether you have pre-paid for it with a UBP; paid cash at the time, or pay for it when you disembark is irrelevant. When in e.g. Spanish territorial waters, or on a closed EU cruise you will pay VAT on drinks. End of.

 

Perhaps you could quote the legal authority for your assertion that VAT is due on the value and not the consideration as set out in Article 73.

 

As for why should they charge VAT when they don't have to? Who knows, why don't you ask NCL. At the same time perhaps you could ask them on the logic of charging VAT on drinks included in the cruise price, why they don't charge VAT on meals served in the MDR that are also included in the cruise price. Or don't the meals have a "value"?

 

As for the rationality, just think about this for a moment. There is no charge for the drinks, so how can there be a charge or VAT, which is a percentage of what has been paid. 10% of $0 is $0.

 

For an example of a UK case on similar issues where catering was provided as part of an inclusive price for transport, I suggest that you read British Airways plc v Commissioners of Customs and Excise [1990] STC 643.

Edited April 6, 2015 by insanemagnet

[SteveH2508]

Perhaps you could quote the legal authority for your assertion that VAT is due on the value and not the consideration as set out in Article 73.

 

As for why should they charge VAT when they don't have to? Who knows, why don't you ask NCL.

 

As for the rationality, just think about this for a moment. There is no charge for the drinks, so how can there be a charge or VAT, which is a percentage of what has been paid. 10% of $0 is $0.

 

Value and consideration are the same thing (Google the 4 elements that constitute an enforceable contract - at least in English common law anyway).

 

How you can assert that there is no charge for the drinks when you have pre-paid for a drinks package is beyond me.:eek:

 

NCL don't give away booze - you have paid for it via the UBP - therefore it is not free (or $0 as you try to imply).

[April7901]

Not strictly correct. If you board in Barcelona for an EU to EU cruise, then VAT is payable on drinks for the entire cruise.

 

 

 

Have the laws changed? I was only charged VAT in Spanish waters in 2010. I'm certain I still have my account summary somewhere to demonstrate.

[insanemagnet]

Value and consideration are the same thing (Google the 4 elements that constitute an enforceable contract - at least in English common law anyway).

 

Value and consideration are certainly not the same thing in VAT law. For example from the UK VAT Act 1994 s19 -

 

"If the supply is for a consideration in money its value shall be taken to be such amount as, with the addition of the VAT chargeable, is equal to the consideration."

 

i.e. value is the VAT exclusive amount, to which VAT is added.

 

How you can assert that there is no charge for the drinks when you have pre-paid for a drinks package is beyond me.:eek:

 

NCL don't give away booze - you have paid for it via the UBP - therefore it is not free (or $0 as you try to imply).

 

I haven't paid for UBP. It was included as a promotion in the cruise fare, which is a charge for passenger transport.

[SteveH2508]

Value and consideration are certainly not the same thing in VAT law. For example from the UK VAT Act 1994 s19 -

 

"If the supply is for a consideration in money its value shall be taken to be such amount as, with the addition of the VAT chargeable, is equal to the consideration."

 

i.e. value is the VAT exclusive amount, to which VAT is added.

 

 

 

I haven't paid for UBP. It was included as a promotion in the cruise fare, which is a charge for passenger transport.

 

So we agree on value v. consideration then - same thing.

 

As to the UBP being a gimme - how NCL deals with the VAT on that - given their recent track record on every other new charge they have introduced - legal rules seem to be the least of their concerns.

 

They do not have a scoobies what they are doing - VAT rules and EU consumer protection legislation do not seem to be on the radar of the current NCL 'management'.

[JimS4210]

Sorry to hijack this thread, but I have a quick question related to this. We're sailing the Norwegian fjords on the Star next month roundtrip from Copenhagen. We also got the UBP free as a promo. Will we have to pay the VAT on any/all of our drinks? Thanks!

 

Jim

[insanemagnet]

So we agree on value v. consideration then - same thing.

 

I am not sure we do, but I don't really want to push the point. I agree that the drinks obviously do have a real world value, but the key point is that since those drinks are not being paid for as a separate supply, then they do not have a value for VAT as there is not a separate supply for a consideration.

 

As to the UBP being a gimme - how NCL deals with the VAT on that - given their recent track record on every other new charge they have introduced - legal rules seem to be the least of their concerns.

 

They do not have a scoobies what they are doing - VAT rules and EU consumer protection legislation do not seem to be on the radar of the current NCL 'management'.

 

From my recent reading of these forums and from my emails of the last few weeks to NCL, I would 100% agree with you.

[BeachMartini]

Geez guys just get out the rulers and start measuring already! :) ;)

Edited April 6, 2015 by BeachMartini

[insanemagnet]

Sorry to hijack this thread, but I have a quick question related to this. We're sailing the Norwegian fjords on the Star next month roundtrip from Copenhagen. We also got the UBP free as a promo. Will we have to pay the VAT on any/all of our drinks? Thanks!

 

Jim

 

If NCL apply the VAT rules correctly, no you will not.

 

As to what they will actually try to do...

[insanemagnet]

Geez guys just get out the rulers and start measuring already! :) ;)

 

https://imgs.xkcd.com/comics/duty_calls.png

[SteveH2508]

I am not sure we do, but I don't really want to push the point. I agree that the drinks obviously do have a real world value, but the key point is that since those drinks are not being paid for as a separate supply, then they do not have a value for VAT as there is not a separate supply for a consideration.

 

 

 

From my recent reading of these forums and from my emails of the last few weeks to NCL, I would 100% agree with you.

 

OK. Let us park the semantics and watch NCL drop a few (lot) more b*ll*cks.:D

 

Legally, in Europe anyway, they have screwed up with this Room Service charge - I do hope that someone on BA or GA from last week gives them the kicking they deserve.

 

This gives me the opportunity to use my favourite word - Schadenfreude.:D

[SteveH2508]

https://imgs.xkcd.com/comics/duty_calls.png

 

OK, as another XKCD fan I get the joke.:D

[insanemagnet]

Legally, in Europe anyway, they have screwed up with this Room Service charge - I do hope that someone on BA or GA from last week gives them the kicking they deserve.

 

And they have not changed their UK website yet, which still says -

 

Complimentary Dining

Morning, noon and night you'll find tempting restaurants, grills, buffets and cafés to satisfy any craving – and they are all included in your cruise fare. If it's a three-course feast you're in the mood for, welcome to our beautiful dining rooms that serve breakfast, lunch and dinner. Maybe dining al fresco with ocean views is in order. You got it – our "endless" buffets offer indoor and outdoor seating with made-to-order omelettes and pasta dishes, fresh salads and much, much more. Plus, there are casual grills by the pool, 24-hour eateries with your favourite comfort foods, lively sports bars, kid's cafés and of course dining à la pyjamas with room service.