Connecticut proposes increased marine taxes

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When Connecticut Gov. Dannel Malloy’s budget proposal is unveiled today, it will call for removing four marine-related tax exemptions from the state’s 6 percent sales tax.

Grant Westerson, executive director of the Connecticut Marine Trades Association, told Soundings Trade Only that the net result would be another blow to the state’s struggling industry and, in the end, a losing financial proposition for the state. Westerson said the sales tax exemptions to be eliminated include:

  • Winter storage fees


  • Labor fees on maintenance and repairs


  • Brokerage commissions


  • Credit for trade-in values


“None of these [exemptions] are gifts; they’re meant to level the playing field against Rhode Island,” Westerson said.

Rhode Island exempts year-round boat storage and maintenance and repair services from the sales tax.

“We’ve started to turn a corner,” Westerson said. “We don’t need a setback like this.”

The association is “power-mailing” postage-paid postcards to Malloy, urging him to maintain the exemptions for the sake of the industry and the state’s boaters. He urges all interested parties to write Malloy to protest his budget plan.

Westerson said eliminating the winter storage exemption is an example of the plan backfiring. He notes that 108,000 boats are registered in the state. Because 75 percent are less than 26 feet, most are stored in driveways and backyards. About 10,000 are stored commercially each winter. At an average of $300 to $600 a year, that translates to a $300,000 to $450,000 tax gain for the state.

“My question is how much business is the state going to lose to Rhode Island because of this,” Westerson said. He estimates that $3 million to $4 million in sales tax and boatyard work fees will migrate across the state border. “The state is not going to make any money on this.”

Malloy’s budget comes on the heels of state Sen. L. Scott Frantz’s introduced legislation that would cut the sales tax from 6 percent to 4 percent on boat purchases and give buyers as much as a million-dollar-a-year break. The bills await action in the Finance, Revenue and Bonding Committee.

Frantz contends that a tax cut would help the state’s struggling marine industry survive. Estimates are that marine-related jobs in the state have been cut by two-thirds in recent years, to about 4,500.

Click here for a local news report on the budget proposal.


10 comments on “Connecticut proposes increased marine taxes

  1. bptsiga

    Ok, here we go with more taxes on top of more taxes. At some point people will figure out that CT. is just too expensive to live here (some already have as we are lsoing residents). Malloy ceratinly knows how to raise taxes let’s see if he has the cuts to cut spending and take on his state union brotheres and sisters?

  2. Mark the Shark

    Typical short sighted thinking of the Connecticut liberal demoncrats. These idiots won’t be happy until all industry and people have left their precious state, and then they will proclaim victory at how they have made great strides in reducing polution and increased green space and the like, when in fact there are just so many less people here, that it has the same effect. It doesn’t matter how many times you prove to them that less taxes actually raise revenue, these fools just don’t get it. They chase the businesses away, and then sit there wondering how they can get more money out of who remains, but eventually, there won’t be anyone left. My wife and I are on an eight year plan. We will be gone no later than that, and possible sooner. And she WORKS FOR THE STATE!! They will lose another business, that employs 10 to 12 people,(and used to employ more, but why bother anymore). My only wory is that they will kill the real estate values before I can pay them off, and I won’t get crap for the house and business property. Who cares, I’ll be able to buy cheaper wherever we go! And it will cost us far less to live there. I only hope my kids don’t settle here, believe me we are trying to get them to see the light of leaving before they get too settled. 

  3. DP

    Actually, it’s just stupid, ill-thought-out legislation. Liberals and Conservatives are both pretty good at that. The problem is that we keep voting for the wrong people! Florida finally got it figured out last year when they capped the sales tax on boats.

  4. Bea

    We’ve been looking for a really good reason to move from our current dock in the southeastern CT for quite some time.  It looks like that time has arrived….

  5. Ct Boat owner

    I’m on my way south with my boat.  I’ve had it with the Taxes in this state. I spend $10 to $20,000 with local boat yards and marinas in Connecticut. If I move south the local yard I use will suffer.   Thanks Gov. Malloy I’m out of here.

  6. Loren Schweizer

    Grant and others should educate their legislators about the Laffer Curve.
    Art Laffer showed how, plotting taxes versus revenues graphically, increasing taxes yields increasing revenues–up to a point. The bell curve then shows decreasing tax revenues as taxes increase further…a losing proposition for government and taxpayers alike.

  7. bill gardella

    Connecticut will come to find out that, like the 10% “Luxury Tax” imposed on new boat sales circa 1986-87, the restoration of taxes on BOATERS  and the new taxes on the BOATERS will be revenue-negative, costing 100’s if not 1000’s of CT jobs.  100% predictable. Too bad so many will suffer before the State comes to admit the mistake. They are partying in Warwick, Jamestown, and Newport though, and i heard talk that Malloy’s birthday will become Rhode Island’s next (paid, thanks to Malloy and his accomomplices) state holiday.
    Governor, true, the ‘Fatcats” of this world maybe can afford it- just remember it is the working man, and woman, that will truly pay for your failure to deal with the real issue, out-of-control State spending.

  8. CT boater

    I’ve been a CT boater for 2 years going on 3. I came to this state from NY to boat because of the insane taxes that NY has. Won’t go to NJ for the same reason. Now CT is falling right in line. My choices now are RI and FL. If they don’t think people are going to leave, then they are very mistaken. What a shame.

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