By its judgment of 16 September 2021 in case C-341/20, the European Court of Justice ruled that Italy infringed EU law in exempting private pleasure crafts, rented and employed by final users for commercial activities, from excise duties, therefore in breach of directive 2003/96/EC.

Directive 2003/96/EC aims at restructuring the energy and electricity products market acknowledging an exemption to motor fuels from excise duties levied on such products only when that they are used for commercial purposes, that is to say for uses where a craft directly meets the purposes of services supplied for consideration.

Worth to be mentioned is the distinction made by the Court between the rental agreement and the transport agreement, the latter not providing for the availability of the craft, totally or partially, but rather for a supply of transfer services of goods and passengers.

European judges particularly noted as from Italian legislation (and namely from article 1, paragraph 6, of Decree No. 225 of 15 December 2015 of the Minister of the Economy and Finance, as subsequently clarified by the circular of 15 March 2016), it emerges that, whenever a rental is at stake, the advantage of the excise duty exemption is granted since rental represents a commercial activity for the lessor according to Italian law. The exemption is then granted by the Italian tax authority regardless of the fact that the final user (the lessee) may use the craft for non-commercial purposes, namely for private pleasure purposes.

In the view of the Luxemburg Court this does not comply with directive 2003/96/EC.