Sardinia To Scrap Wealth Tax Regime

by Lorys Charalambous, Tax-News.com, Cyprus

27 March 2009

Sardinia’s new governor, Ugo Cappallacci, has announced this week that he is to retract his predecessor’s luxury tax regime. The sunny island off the coast of Italy, which hosts numerous VIPs and HNWIs, currently levies substantial taxes on private yacht and flight arrivals.

Cappallaci, the son of Berlusconi’s tax adviser, was encouraged by the Italian leader to stand for election in the jurisdiction – eventually achieving a resounding victory over his centre-left rival Renato Soru in elections last month.

Cappallaci has lost no time in proposing the retraction of Soru’s luxury tax policy, which was first introduced in 2006 to maintain the island’s ‘exclusivity and beauty’.

Under Soru’s leadership, yachts mooring at the island’s ports were required to pay a levy of between EUR1,000 (for yachts between 14m and 16m long) and EUR15,000 (for yachts of over 60m) for the privilege, regardless of the length of a visit. Taxes were also levied on visitors arriving to the island by private jet.

Cappallaci’s new policy will see the abolition of the taxes and open up the island to less exclusive building projects. The new policy will aim to make the island more accessible to tourists whilst maintaining its natural beauty.

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