The Ministry of Taxation has withdrawn an appeal filed with the
Supreme Court concerning the scope of the Danish Tonnage Tax Act.
With this decision, it now clear that ship-to-ship cargo transfers
of fuel to GPS coordinates on the continental shelf meet the
destination requirement of the Danish Tonnage Tax Act.
The Tonnage Tax Act is a special tax scheme available to
shipping companies, subject to certain conditions. Shipping
companies that qualify for taxation under the scheme are taxed on
the basis of their total net tonnage and independently of the
shipping company's income. The scheme covers, inter alia,
income earned by sailing "between different
destinations".
Offering favourable treatment to shipping companies, the tonnage
tax scheme is considered as State aid and must therefore be
interpreted in accordance with the EU State aid rules and the
European Commissions' approval of the scheme.
