In what could be a substantial tax break for Sir Richard Branson and uber-rich space tourists, the Swedish government is close to classifying Virgin Galactic space tourism flights as sounding rockets.
Hyperbola’s Rob Coppinger reports that a government review has concluded there are no barriers to classifying suborbital tourism flights flown out of Spaceport Sweden as sounding rockets. Officials are hoping the Ministry of Commerce will approve the idea.
This move would be financially advantageous for both Virgin Galactic and its wealthy clientele. Space News reported earlier this year that Swedish officials were looking to put the flights into the same category as hot air balloon rides and sounding rockets because the value added tax (VAT) on these activities is lower. Otherwise, Sweden’s higher value-added taxes would kick in, adding as much as 25 percent to the $200,000 ticket.
The move would not require any changes in Swedish law, easing the way for Branson’s company to begin tourism flights from Kiruna early in the next decade. Coppinger reports that the Swedish government, which faces elections within two years, might have a difficult time getting new laws passed before the vote. The next government might not be as amenable to providing a lower tax rate for joyriding millionaires.
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