Florida took in nearly 10 times as much sales tax revenue on sales of tax-capped boats as the state projected in the first year of implementation of the Maritime Full Employment Act, which was signed in 2010.
That’s according to a study released by the Florida Yacht Brokers Association and the Marine Industries Association of South Florida.
The new law puts an $18,000 sales-and-use tax cap on boats purchased or brought into Florida. The new sales-and-use tax cap generated in excess of $13.46 million in direct sales tax revenue for the state, compared with a $1.5 million first-year loss that a Florida legislative staff analysis had projected.
Thomas J. Murray and Associates Inc. conducted the initial research and subsequent survey.
Prior to July 1, 2010, all boats sold and or delivered in Florida were subject to a 6 percent sales-and-use tax unless they were specifically exempt. A new 34-foot powerboat that cost $400,000, for example, would cost $24,000 more in taxes.
Among the survey’s findings:
• The average sales price for post-cap transactions in Florida was $907,002 — nearly double the pretax value of closings that took place in Florida prior to the cap.
• In the post-cap era, transactions for which either no sales tax was paid or the closing was conducted out of state dropped from 21.5 percent in the pre-cap era to an estimated 12.8 percent after the sales tax cap was implemented.
“The results of our survey research demonstrate beyond a doubt that setting a reasonable tax basis for high dollar purchases provides an incentive for more boats to be purchased, provisioned and kept plying the waters of Florida,” FYBA spokesman Jeff Erdmann, owner of Bollman Yachts of Fort Lauderdale, said in a statement. “More boats sold and registered in Florida means more business and jobs for Floridians.”
A little over a year ago, there was no caps on sales tax and rather than pay the tax, people would offshore register their yachts rather than pay Florida Sales Tax on them. With a cap, Florida is receiving badly need income they did not receive prior to the cap being put into effect. It was a good move and long overdue.
Post a Comment