Tax Update Shipping & Offshore - May 2026
We are pleased to present the 2026 edition of our Tax Update Shipping & Offshore.
This update highlights a number of important and timely developments affecting the European shipping and offshore sectors, spanning EU State aid, national shipping tax regimes and key international tax developments under Pillar Two. At EU level, the newly adopted Middle East Crisis Temporary State Aid Framework (METSAF) introduces targeted and accelerated support measures for sectors exposed to crisis‑driven fuel price volatility, including short sea shipping.
In Greece, further guidance has been issued on the New Voluntary Shipping Contribution, confirming its mandatory effect in practice and providing clarity on scope, income base and compliance. Sweden has published a far‑reaching proposal to modernise and significantly broaden its tonnage tax regime, with particular relevance for offshore and specialised maritime activities.
Finally, we provide an update on Pillar Two developments relevant to shipping, including the international shipping exclusion, the ongoing discussion on the SBIE for mobile assets, and recent OECD and KPMG work on the interaction between Pillar Two and tax incentives. Question especially is whether the Substance-based Tax Incentive Safe Harbour will impact the maritime, shipping and offshore industry?
As always, we aim to offer clear insights into developments shaping the fiscal and regulatory landscape for the global maritime sector.
Enjoy the May 2026 update
Table of Contents
- 1. EU: Commission adopts temporary State aid framework to support sectors affected by Middle East crisis
- 2. Greece: Greek shipping voluntary contribution
- 3. Sweden: Government Proposes Improved Tonnage Taxation Rules
- 4. Pillar 2: The international shipping exclusion, SBIE for mobile assets and more
1. EU: Commission adopts temporary State aid framework to support sectors affected by Middle East crisis
The European Commission has adopted the Middle East Crisis Temporary State Aid Framework (METSAF), a temporary and targeted State aid regime applicable until 31 December 2026, aimed at mitigating the impact of the Middle East crisis on the most exposed sectors of the EU economy, including intra‑EU short sea shipping. Under METSAF, Member States may grant aid to short sea shipping operators covering up to 70% of the additional fuel costs resulting from crisis‑related fuel price increases, calculated by reference to the difference between current market prices and a historical benchmark, applied to current or pre‑crisis fuel consumption. As an alternative, Member States may apply a simplified aid mechanism, allowing support of up to €50,000 per beneficiary based on sectoral proxies (such as vessel type or activity level), without requiring detailed evidence of actual fuel consumption. National aid schemes must be notified to the European Commission, but benefit from an accelerated approval process, making METSAF a potentially relevant short‑term relief instrument for short sea shipping operators affected by fuel price volatility.
2. Greece: Greek shipping voluntary contribution
AADE Circular E.2018/2026 provides detailed guidance on the application of the New Maritime Agreement (Νέο Συνυποσχετικό) between the Greek State and the shipping community, as amended in 2022. It clarifies the scope and calculation of the New Voluntary Contribution payable by Greek tax resident individuals who are ultimate shareholders, partners or beneficial owners of shipping companies falling within the scope of Law 27/1975 (Greek shipping tax regime).
The voluntary contribution is set at 5% of amounts remitted or deemed remitted to Greece, deriving from:
- dividends of qualifying shipping or holding companies, and/or
- capital gains from the sale of shares in such companies,
- including cases where the distribution or share transfer takes place in Greece and funds are credited to Greek bank accounts.
The circular confirms that:
- Non‑remitted worldwide shipping income remains fully covered by the tonnage tax regime of Law 27/1975 and is not affected.
- The obligation applies to income from Greek‑flag vessels and from foreign‑flag vessels managed from Greece under Article 25 of Law 27/1975.
- The contribution is reported annually via the personal income tax return (E1), starting from tax year 2022 onwards.
Importantly, as more than 90% of the relevant fleet tonnage managed from Greece has adhered to the agreement, the collective action clause is triggered. As a result, all Greek tax resident beneficial owners within scope are liable to the contribution regardless of whether their companies have formally acceded to the agreement, for 2023–2024 and subsequent years.
This circular therefore confirms the mandatory practical effect of the voluntary contribution mechanism and provides legal certainty on its personal scope, income base and reporting mechanics.
3. Sweden: Government Proposes Improved Tonnage Taxation Rules
We mentioned it before in our updates, but in Proposition 2025/26:243, the Swedish Government proposes a substantial modernisation of the Swedish tonnage tax regime aimed at strengthening Sweden’s competitiveness as a maritime jurisdiction and aligning the regime more closely with EU State aid guidelines and European Commission decision practice. A central element of the reform is a significant expansion of the scope of qualifying vessels and activities, extending the tonnage tax beyond traditional cargo and passenger shipping to include a wide range of specialised and offshore‑related activities. Newly qualifying activities explicitly include cable‑laying and pipeline‑laying operations, salvage and wreck removal, towage, bunker supply, icebreaking, maritime surveillance and guard services, search and rescue and other emergency response services, as well as offshore service vessels supporting offshore wind farms, oil and gas platforms and subsea installations. These activities are treated as qualifying shipping activities in their own right, reflecting the operational reality of modern maritime services and bringing Sweden broadly in line with other EU tonnage tax regimes.
In addition, the proposal abolishes the existing requirement that vessels must operate in “international traffic” and replaces it with a broader test under which vessels qualify if they operate in markets exposed to international competition, even where voyages are conducted solely between Swedish ports. This change is particularly relevant for short sea shipping and specialised offshore activities that compete directly with foreign operators.
The reforms also introduce greater flexibility for bareboat chartering, allowing shipping companies to lease out up to 50% of their qualifying gross tonnage without crew (previously 20%) for limited periods, thereby improving fleet management options during cyclical market downturns. For vessels engaged in special shipping activities, the minimum gross tonnage requirement is reduced, enabling smaller but highly specialised vessels to fall within the regime. Finally, the proposal introduces more generous rules on over‑depreciation reserves and a series of technical clarifications aimed at increasing legal certainty and administrative simplicity. The legislative amendments are scheduled to enter into force on 20 July 2026 and will apply for the first time to financial years beginning after 31 December 2026.
4. Pillar 2: The international shipping exclusion, SBIE for mobile assets and more
International shipping exclusion
The Pillar 2-GloBE rules contain an exclusion (article 3.3.2) for ISI which primarily focuses on the income obtained by a Constituent Entity from the transportation of passengers or cargo by ships in international traffic. International traffic means “any transport by a ship, except when the ship is operated solely between places within a single jurisdiction”. Based on paragraph 153 of the GloBE P2-Commentary, the ISI-exclusion is also applicable on “the profits from transportation of passengers or cargo in international traffic by offshore service vessels.” However, offshore service vessels normally provide a number of mixed services, which concern both transportation services and other offshore services. This raises the question how to separate profits related to the international transportation service (ISI-exclusion applicable), if any, and the other offshore services (ISI-exclusion not applicable).
Any Administrative Guidance to this issue is lacking for the time being. The lack of guidance leave a large number of ship owners and implementing national governments in uncertainty about the correct application of the ISI-exclusion with a potential (further) loss of level playing field among Pillar 2-implementing countries and between Pillar 2-implementing countries and non-implementing countries as a consequence.
Together with other tax experts we have prepared a memorandum on the international shipping exclusion for offshore service vessels. Especially as the Commentary mentions that offshore service vessels can qualify if international traffic is performed, if it is possible under the GloBE rules clear guidance is required how in practice this should be applied. Our memorandum has been discussed recently with the OECD Secretariat and will be circulated among approximately 70 countries within the Community of Experts. Countries can subsequently indicate whether they wish to be involved, after which a multilateral call/meeting will be organized to discuss the memorandum. Feel free to ask for the relevant memorandum by sending an email to: bioch.ernstjan@kpmg.com
SBIE for mobile assets
The SBIE for mobile assets, such as vessels / ships used in the maritime offshore industry, is still on the agenda and being discussed.
KPMG article on Pillar 2 and tax incentives
We are excited to share the release of our updated KPMG article “Pillar Two and tax incentives“.
This article analyses how the application of different types of tax incentives may trigger a potential Top-up Tax exposure. It further examines the mechanics and implications of the newly introduced Substance-based Tax Incentive Safe Harbour and assesses how jurisdictions may be incentivized to adapt their regimes to ensure that local incentive offerings remain effective and efficient in light of an evolving Pillar Two framework.
The SBTI Safe Harbour is expected to be a game changer in many cases as it allows for the value of a wider range of incentives to be protected from Pillar Two claw back, including super deductions and non-refundable tax credits, production-based tax incentives and (in certain circumstances) income-based tax incentives, such as low rates or exemptions.
For jurisdictions, the SBTI Safe Harbour also provides potential alternative paths to the redesign of tax incentive regimes and it is expected that the upcoming months will see significant developments in local tax incentives policies, as recognized by the OECD in their just-released practical guide to Investment Tax Incentives.
In this context, the article provides an overview of how countries are responding to Pillar Two implementation and the new SBTI Safe Harbour and which actions / legislative amendments have already been taken or are being considered locally.
The article also provides insights with respect to further OECD guidance that is expected to provide safeguards around use of incentives that would effectively ‘hand back’ Pillar Two top-up tax to in-scope MNEs (related benefits rules).
Please contact:
Conrad Turley Global Tax Policy Leader KPMG International E: conrad.turley@kpmg.com or Head of KPMG’s EU Tax Centre E: renache@kpmg.com
