British ferry operator P&O announced it will re-flag two of its vessels to keep European Union tax arrangements ahead Brexit. The company is reviewing all of its UK-registered fleet.
A P&O spokesman told Reuters that two of its UK ships operating on the English Channel route to France would be re-flagged to Cyprus, in a bid to preserve the tonnage tax financing arrangements, ‘under which the ships should remain flagged in an EU member state‘.
The spokesman added that P&O was reviewing the flag status of its four other ships operating on the Channel route, although no final decision had been taken so far. Such a taxation system allows shipping companies to pay corporation tax based on the tonnage of their vessels rather than on profit.
According to Reuters, as of November 2018, there were 1,306 vessels of over 500 GT (gross tonnage) per ship registered with the British flag, down from 1,317 in 2017, 1,328 in 2016, 1,330 in 2015 and 1,327 in 2014.
