Sailors with money to spend prefer the Balearics. The revenue from superyacht charter spending in the Balearics increased 38 percent in 2017 compared to the previous year. Over the past four years, the income – both for the local economy and in terms of VAT collected – has multiplied more than tenfold, according to a new report by AEGY (Spanish Large Yacht Association).
The superyacht charter industry fed €13,472,462 in expenses into the local economy in 2017, and this figure doesn’t even include income or VAT from local charter yachts or boats under 20 metres.
“Yacht charter is helping the Balearics become a consolidated yachting destination, which generates local jobs and boosts the economy year-round,” says Jonathan Syrett, Senior Sales Broker at Camper and Nicholson. “Charterers are big spenders ashore: fuel, berthing fees, food and drink all add up, and yachts pay for refits during the low season. In 2017 the amount of VAT collected on yacht charters in Spain was €12,265,305. This is an increase of 40 per cent over 2016 and almost 1,000 percent since 2013.”
AEGY reports that in 2017 the number of yachts with a charter license increased to 170. Of these, 38 are more than 45 metres – in 2013 there were none, and 65 yachts are over 35 meters, compared to five in 2013.
So why are superyacht charters so popular now? The initial incentive came in 2013, when a modification to tax laws meant that yachts of any size intended exclusively for charter would be exempt from ‘special tax’, and in 2014, further regulation changes brought Spanish law regarding charter yachts more in line with other EU states.
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A good reflection of superyacht industry growth in the Balearics is Palma Superyacht Show, which was launched in 2013, and has quickly developed into one of the biggest events on the international yachting calendar. Running from 27 April – 1 May, the show allows visitors wanting to buy or charter a yacht to get up close and personal with vessels over 24 metres.
The yachting support service companies in the Balearics have also helped enable the growth of the industry. Of the eight largest companies in the world dedicated to luxury yachting sector, six have offices in Mallorca.
In answer to demand, brokerage and charter company, Sanlorenzo, have recently begun to offer a ‘new breed’ of charter yacht, the Sanlorenzo SD126 ‘Takara’ – a 38 metre tri-deck superyacht. “The Balearic yachting industry has gone from strength to strength, and a key component of this is our charter industry,” says Andy McDougall, Director of Sanlorenzo Spain. “As discerning clients throughout the industry increasingly demand a more bespoke approach to yachting, their expectations for charter itineraries and charter yachts have evolved accordingly.”
The growth of the luxury charter industry is exciting news, especially considering that Spain does still not compete on equal terms with neighbouring countries: VAT in Spain is higher than neighbouring countries, bureaucracy takes longer, and legalities are at times open to interpretation.
“Legislation in the Balearics is not yet as easy as it first appears,” says Béatrice Lafaille, CEO at Ocean Dreams Charter & Brokerage. “In theory a yacht staying permanently in Spain is due to pay the 12 per cent tax registration if the owner also wants to use the boat privately, which is an inconvenience and very few owners are aware of it.
“However, there is an increase in the interest from owners who wish to charter their boat to cover part of their expenses – it’s not about becoming a millionaire, but they can enjoy their yacht with zero, or almost zero expenses,” she adds.
Fiona McCarthy, Charter Broker at FRASER Yachts concludes: “There has been an increase of charter yachts based out of Palma or surrounding ports, and more owners willing to get the Spanish charter license. The relatively uncrowded anchorages and variety of bays and scenery are big draws for yachts and clients, as well as the relaxed chic vibe of the island.”
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