One of the most discussed subjects in the golfing industry is the rate of Value Added Tax (VAT) levied on a round of golf, and the often huge variances in duty between proprietary clubs and members clubs. From 25 per cent on yearly fees and green fees in Denmark for ‘commercial’ courses and a zero rate for noncommercial courses, to golf course owners in countries like the Netherlands who pay a lower rate of just six per cent, the subject of VAT is often cause for concern to many golf course owners.
Various VAT levels result in false competition between golf clubs and can have a detrimental effect on the development of the game with the ‘commercial’ clubs -who traditionally promote and teach new golfers – having to charge VAT whilst their ‘non-commercial’ counterparts do not.
Various national tax authorities in the European Union treat commercial and non-commercial golf courses different for VAT. The GCAE sees this as a serious case of distortion of competition. Therefore, the GCAE has launched a working group in cooperation with the English Golf Union to work on the VAT polices and regulations affecting the golf business. The GCAE aims at equalizing the VAT level that golf owners pay throughout the whole European Union.
Follow Up on the Communication
In its conclusions adopted on 15 May 2012, the Council welcomed the Commission’s Communication on the future of VAT and supported the objective of an EU VAT system which should be simpler, more efficient and neutral, robust and fraud-proof.
Preparatory steps to the Communication Green Paper on the future of VAT – Towards a simpler, more robust and efficient VAT system
On 1 December 2010, the Commission adopted a Green Paper on the future of VAT – Towards a simpler, more robust and efficient VAT system. A Commission Staff Working Document accompanied the Green Paper and provides a more detailed technical analysis for each of the themes covered download below.
The Green paper was followed by a six month public consultation on how the EU VAT system can be strengthened and improved to the benefit of all stakeholders. The Commission received 1726 replies from businesses, academics, citizens and tax authorities. This constitutes a record response to a tax consultation. The European Parliament (EP), the European Economic and Social Committee (EESC) and the Tax Policy Group (who are the personal representatives of the EU’s finance ministers) welcomed the Green Paper and confirmed the need to reform the VAT system.
Public Consultation on the Review of existing legislation on VAT reduced rates
The European Commission proposed a public consultation to gather the key views of all interested parties on the questions raised in the consultation document ‘Review of existing legislation on VAT reduced rates’ dealing with the abolition of the reduced rates on goods and services for which the consumption is encouraged by EU policies.
The GCAE Submits letter of recommendation under the public consultation
The GCAE has made a submission of recommendations regarding VAT in Golf.
Usefull weblinks to partner organisations:
European Commission Taxation and Customs
UKGCOA – United Kingdom Golf Course Owners Association
EGU: VAT Seminar Meeting Report
A Walk Down the Fairway of Value Added Tax: A Practical Guide to Vat for Golf Clubs
Scottish Golf: VAT and Golf Clubs
Articles regarding VAT on golf:
Golf Management Europe – VAT needs one rule for all
Golf in Spain – VAT increase for Spanish Golf
Lawandtax-news.com – UK Golf Clubs Urged To Reclaim Ten Years’ Worth Of VAT
Mark Bodt (Price Waterhouse Coopers) during GCAE Conference 2009 – Presentation VAT and Golf