33% VAT increase on recreational boating: a measure that alarms the industry. A parliamentary amendment submitted to the Assemblée Nationale on 18 October by members of La France Insoumise – Nouveau Front Populaire has reignited the fiscal debate in France regarding the recreational boating sector.

The proposal, contained in amendment no. 1-2259 to the 2025 Finance Bill, seeks to raise VAT on luxury goods to 33%, explicitly including yachts, sailing boats and motorboats over 20 HP.

According to the specialised magazine ActuNautique, the measure — presented under the banner of “fiscal justice” — would in reality have a severely detrimental impact on the nautical supply chain, threatening jobs, shipyards and related businesses along the entire French coastline.

The French boating industry generates an estimated €5 billion in turnover and employs over 50,000 people, directly and indirectly. It is a complex ecosystem comprising shipyards, suppliers, engine manufacturers, dealers, sailing schools, marinas and charter companies.

A 33% VAT rate would affect the entire sector across the board, already struggling with economic stagnation, leading to an immediate drop in domestic demand and a further fall in new-boat sales, already declining since 2024.

The measure would also fail to differentiate between different categories of buyers, imposing the same tax burden on someone purchasing a €25,000 used boat and on someone investing in a multimillion-euro yacht. A distortion that, as the French publication points out, “has nothing progressive about it” and risks compromising a sector that cannot be equated with traditional luxury goods.

Such an increase would likely trigger an immediate domino effect:

– a sharp decline in domestic sales, with French owners postponing or shifting purchases abroad;

– a slowdown in production, threatening the survival of many shipyards and associated jobs;

– knock-on effects on maintenance, refit, component supply and coastal tourism.

The latter is already under pressure from recent environmental regulations — such as those protecting Posidonia meadows — well-intentioned in principle but introduced without a parallel plan for dedicated mooring fields for large yachts.

Moreover, the expected tax revenue would likely prove counterproductive, as shrinking sales volumes would narrow the taxable base and drive many buyers towards registration or purchase outside France.

Despite widespread criticism, the chances of the measure being approved are low: the European Union sets a maximum VAT threshold of 25% and requires unanimous consent from Member States to allow higher rates.

The amendment therefore appears to be a symbolic and demagogic proposal rather than a coherent economic measure — useful mainly for political positioning. ActuNautique also highlights the contradiction of some of its promoters, recalling that figures close to La France Insoumise have in the past collaborated with the world of sailing and nautical communication.

A déjà-vu for the boating industry: the Italian precedent of 2012

The French debate brings to mind the Italian case of 2012, when the Monti government introduced the so-called “berthing tax” for recreational craft, soon dubbed a “boat ownership tax”.

Originally intended to boost fiscal revenues, the measure turned out to be one of the most damaging in the history of Italian boating: within a few months it caused the abandonment of thousands of boats, a collapse in the domestic market and a mass exodus of vessels to foreign ports, especially Croatia and France.

The tax, proportional to vessel length, struck indiscriminately, triggering a deep crisis throughout the industry: a fall in sales, a drop in charter activity, the closure of shipyards and job losses.

It was a punitive and ultimately counterproductive measure, similar to the one now proposed in France: demagogic, ineffective and even detrimental to public finances.

Should Paris actually raise VAT on boating to 33%, it would risk repeating Italy’s mistake, targeting a strategic industrial sector in the name of a merely rhetorical “fiscal justice”, while sacrificing employment, competitiveness and innovation.