A study carried out by Monitor Deloitte on behalf of the European Community Shipowners’ Associations (ECSA) underlines the need for changes to the tax framework applied to shipping if the sector is to remain competitive and strengthen its position on the international market.
“The shipping industry in the EU is a highly mature industry and an economic giant in the European economy directly accounting for over 620,000 jobs. On the global level of shipping, the EU is still a large player compared to most regions in the world with 36.5 percent of owned gross world tonnage and 46.2 percent of operated world tonnage. An overall competitive regime for fiscal and social measures as well as quality registers and a strong skills base support the current status of the EU as a location for shipping activities,” the study states.
According to the Monitor Deloitte survey which compares five international maritime centers (Singapore, Hong Kong, Dubai, Shanghai and Vancouver), with the world’s largest growth, the EU’s maritime policy has deficits in key competitiveness indicators, tax and economic incentives, regulatory framework, flag attractiveness and the legislative framework of maritime activity.
The survey goes on to identify two more gaps in policy: the first concerning the regulatory framework relating to the application and legal status of the SAGs for competitiveness, and finally, a gap on flag attractiveness and the legal framework for vessel exploitation.
The Monitor Deloitte study confirms that in terms of fiscal and economic incentives, the EU framework is less attractive than other markets, particularly with regards to eligibility criteria relating to the flag requirement and the current ring-fencing of maritime activities applicable to tonnage tax put in place by the European Commission.
The study concludes that to develop further growth in European shipping, the EU must implement an effective, globally oriented shipping policy that aims to improve the EU’s competitiveness as a location for international shipping.