Florida Extends Boat Sales Tax Exemption

30 May 2009 By Kelly Sanford

On May 21st, Florida Governor Charlie Crist signed into law a number of bills aimed at stimulating the state’s economy. Of interest to the yachting community is Florida House Bill 7031, which effectively doubles the length of time an out-of-state buyer can keep his or her boat in the state of Florida before incurring sales or use taxes.

Previously, out-of-state yacht buyers could purchase a “10-90 decal” which allowed their vessel to remain in-state for 90 days after the date of purchase without incurring taxes. When the Marine Industries Association of South Florida (MIASF) learned that the 10-90 exemption was on a list of tax exemptions under consideration for elimination, MIASF Executive Director, Frank Herhold said, “We felt our best defense would be a spirited attack.” Partnering with the Florida Yacht Brokers Association (FYBA), the MIASF was able to successfully convince Representatives in Florida’s state legislature that not only should the exemption remain intact, but that an additional 90-day extension should be made available in order to invigorate the state’s struggling marine industry.

FYBA Director Whit Kirtland said, “It was an aggressive effort to educate politicians up in [Florida’s capital] Tallahassee about what happens here in South Florida and the rest of the state when buyers are forced out. I think our most effective arguments came from [a Representative] who was able to come to South Florida and speak with a yacht owner who had purchased his yacht in state but took it out of Florida in order to do over a million dollars worth of refit work. Sitting in a shipyard, I think it really hit home with [that Representative] what a million dollars worth of refit revenues would mean to in terms of the local marine industry and subsequent opportunities to raise revenues for the state.”

Herhold said, “We are ecstatic that the legislature recognized the benefits of encouraging business from out-of-state boat buyers…. By enacting the new 91-180 extension, they have made a good thing even better.” The existing 10-90 day decal costs $20. The 91-180 extension will be substantially more – three or four hundred dollars, according to Kirtland – but still a nominal fee compared to six percent of the yacht’s value assigned for sales or use tax.

Herhold describes the bill’s passage as “a marine industry stimulus package that will help … in the recovery process.”

Echoing his sentiments, Governor Crist’s Press Office released a statement to the media that said, “Allowing boat owners and their guests to remain in Florida waters will stimulate Florida’s marine industry, as well as stimulate businesses that support the marine industry.” Kirtland added, “This bill is not just a benefit to the shipyards and marine trades, but it will mean more money for bars, restaurants and retail. This bill is going to be good for everyone.”

Indeed, this is a welcome morsel of good news amid the dizzying barrage of less encouraging stories about the seemingly relentless softening of the marine industry and the merciless posturing against the wealthy, absent of consideration for the industries that are dependent upon them.