Yacht tax credit for New Yorkers
by Malcolm MacLean
A tax credit for luxury yacht buyers will be introduced in New York in a bid to boost the superyacht industry and make it competitive with other yachting hubs such as Florida.
New York State's Governor Andrew Cuomo presented the plans - which accounts for a tax break for anyone buying a yacht over $230,000 - in his recent budget announcement. It means that buyers will not have to pay sales tax beyond that amount, regardless of the final price paid.
Chris Squeri, executive director of the New York Marine Trades Association, explained: "This is not about giving yacht owners a break. This is about creating jobs and boosting both marine businesses and sales tax revenue. For years, New York state and its marine businesses have lost money to other states and foreign entities. People purchase and register boats out of state. New York has been losing for years, especially to Florida."
This policy is proven to boost superyacht sales: In 2010, Florida capped the total sales tax paid on any boat at $18,000 and a study by the Florida Yacht Brokers Association found that the state took in nearly 10 times as much sales tax revenue on sales of tax-capped boats as the state projected in its first year.
Supporters of the Florida tax break argued that the measure was needed to capture tax revenue being lost by boat buyers who legally skirted Florida's tax laws. Yacht brokers commissioned a study showing that many high-end yacht owners avoided taxes by buying their boats with foreign corporations housed offshore.