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Sales of Jet fuel within airports fences in Greece & Bulgaria are generally considered as untaxed sales – fiscal warehouse regime of airports. However, for an aircraft operator to qualify for an untaxed regime both the transcripts and the nature of the flight need to be explicitly presented & proved to the customs directorates of Greece and Bulgaria post flight event. The following content aims to facilitate our customers’ education around the framework of each country and serves as a general direction but note that each flight performed is case sensitive.
Shell & MOH would not be directly liable either for waiving or charging MOT and taxes.
We do facilitate our customers and request that all related information for tax exemptions is timely submitted to country’s customs authorities, ultimately however decision always lies with them and is subject to post flight control checks, which may lead to change of the exemption regime applied and retroactive charges.
Quote as per GENERAL DIRECTORATE FOR CUSTOMS & EXCISE DUTIES, SPECIAL PROCEDURES & EXEMPTIONS DIVISION - DEPARTMENT C, SPECIAL EXCISE DUTY & VAT DIVISION - DEPARTMENT E.
Related law appendixes
As regards the applicable tax treatment of fuels used in civil aviation in terms of excise duty, according to Article 78(1a) of Law 2960/2001 (GG A, 265), as in force (which has transposed the provisions of Article 14(1)(b) of Directive 2003/96/EC), “energy products supplied for use as fuel for the purpose of air navigation other than in private pleasure-flying” are exempt from excise duty. “Private pleasure-flying” shall mean the use of an aircraft by its owner or the natural or legal person who enjoys its use either through hire or through any other means, for other than commercial purposes and in particular other than for the carriage of passengers or goods or for the supply of services for consideration or for the purposes of public authorities”.
Furthermore, according to the Special Ordinance of the Minister of Finance (“EDYO”) Ref. Δ.81/16/Α0018/19.01.2006 “Aircraft fuelling with fuel exempted from excise duty” the following documentation is submitted to the Supply Customs Office at the time the aircrafts concerned are supplied with fuel:
Furthermore, according to Document Ref. Δ2/Γ/1144/2-2-2018 of the Civil Aviation Authority under (c) above, the Air Operator Certificate presented by the airline/lessee shall lay down the terms of dry lease. In the case of a wet lease, however, the leased aircrafts are not included in the lessee’s Air Operator Certificate; therefore, the fact that the particular aircraft is operated by the particular lessee shall be evidenced by the relevant lease agreements, which are available in copy both inside the aircraft and at the relevant department of the Civil Aviation Authority.
Based on the above, and taking into account those situations where the leased aircraft is not indicated in the Air Operator Certificate of the lessee (e.g. in the case of wet lease), at the time the aircrafts concerned are supplied with fuel the airline is liable to submit, together with the Summary Declaration, the part of the lease agreement indicating the contracting parties, the leased aircraft and the term of lease, irrespective of the place where the lessee (airline) is established, in order to prove the legitimate use and operation of the aircraft by the airline supplied and in order to establish its eligibility for exemption from taxation (excise duty and VAT) in accordance with the above provisions.
As regards the applicable VAT treatment of fuels intended for aircraft supply, according to the provisions of Article 27(1) of Law 2859/2000 on “Ratification of the VAT Code” (which have transposed the relevant provisions of Council Directive 2006/112/EC), the delivery and importation of aircrafts intended among others for operation by airlines operating for reward chiefly on international routes, and the delivery and importation of goods and materials intended to be integrated in, or used on, such aircrafts are exempted from taxation.
“International transport” is any transport carried out by airlines to and from foreign locations, provided that the revenues arising from such transport exceed fifty per cent (50%) of their total annual gross income generated from air transport in the fiscal period preceding the delivery or import. The exemption also applies to the delivery and importation of any fuels, lubricants, food supplies and other goods intended for the supply of vessels and aircrafts that are subject to exemption according to the provisions of points (a) and (b) [point (c)].
Moreover, according to case law of the European Court of Justice (Case C-33/11 A Oy), the sole criterion for determining the applicability of the exemption is whether an aircraft is used by an airline operating for reward chiefly on international routes.
All Aircraft Operators (foreign or domestic established) that perform domestic routes are obliged to obtain a valid VAT exemption document from competent Greek Tax Office after applying timely for it and proving that are eligible for obtaining such certificate exemption (based on their eligibility to perform chiefly on international routes, financial statements etc.). Such exemption document should be maintained in annual validity, thus operators are asked to timely make the necessary arrangements with local Greek Tax Office and after obtaining inform and disclose to Shell & MOH as their fuel supplier.
The Value Added Tax (VAT) has a standard rate of 24% to all locations except KGS where the VAT rate is 17%. As per Custom import Duties the Excise Duty surcharge is 0.410 ELT on mineral oil products, which are subject to excise duty and on top of that special Customs fee is calculated at a rate of five per thousand (5‰).
Excise duty exemption applies only if Jet Fuel is sold for the purposes of commercial aviation, i.e., for the use of the aircraft in the air in transporting passengers or cargos, or performing services for reward, or for the needs of state bodies.
Exemption is allowed only for the direct sale for fueling the aircraft of the commercial aviation operator (the airline). The customer airline must provide to Shell & MOH Aviation Fuels Bulgaria (SMBG) with a statement in Enclosure No 4и to RIVATA.
No excise duty exemption is allowed for sales to intermediaries - resellers or agents, even if these intermediaries further supply the fuels to commercially operated airline.
VAT exemption applies only to supplies of jet fuel to aircrafts used by aviation operators who operate chiefly for reward international routes. The customer must be (a) an aviation operator and (b) operating chiefly international routes and (c) for reward, i.e., against remuneration. To prove these facts the customer must submit to SMBG the Declaration - Enclosure No 25 to the Regulations for Implementation of the VAT Act.
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