What do yacht owners want? Well, there are many ‘wants’ of course, but specifically they want to pay less on taxes when purchasing new yachts.
Like most buyers of any type of product, regardless of their social and financial status, yacht owners would like to minimize the amount of taxes they pay on their new boats. And when you consider the tax bill on a $1 Million dollar vessel, much less tax bills on boats well over $1 Million, a tax break could prove tremendous.
Consider proposed legislation in Texas. The state of Texas is debating whether to cap the sales tax on yachts at $18,000 – regardless of the sales price – or continue on with the current sales tax of 6.106%. Currently, A $1 Million dollar yacht would incur an additional sale tax of $61,060. A $5 Million dollar yacht would incur a shocking $305,300 additional charge. A $10 Million dollar yacht…well, you get the picture.
Like Clayton Reaser, the Dallas entrepreneur mentioned in the above article, most current (and potential) yacht owners made their money by intelligently managing their business and finances. They have a focused acumen when it comes to generating income while suppressing costs. Naturally, they would be seeking to pay the least amount of taxes possible on their new yacht.
Regardless of whether the boat is being built for pure enjoyment or as a business investment, the amount of money that the owner is spending can be substantial. States need to find a balance between filling coffers and generating tax breaks with the purpose of stimulating spending.