A Connecticut lawmaker introduced legislation that would cut the sales tax on boat purchases and give buyers a million-dollar-a-year break.
State Sen. L. Scott Frantz, a private-equity millionaire, wants to cut the 6 percent sales tax to 4 percent for boat sales in an attempt to help the ailing industry, the Connecticut Post reported.
"Connecticut has a long, rich history in building, maintenance and selling," he told the newspaper. "A few years back, the industry supported 12,000 jobs in the state and now that's down to 4,500. You hate to see that happen. A once lucrative, wonderful industry is literally on its tail."
The proposal comes at a time when Gov. Dannel Malloy's 2012 budget request would remove a valuable tax benefit for boat buyers, the National Marine Manufacturers Association reported.
Under current law, buyers pay sales tax on the difference between the purchase price of a new boat and the value of a trade-in. The governor wants to remove this tax policy.
The NMMA said it is working with the Connecticut Marine Trades Association to oppose Malloy's change.
The state Department of Revenue Services said that in the fiscal year that ended last June 30, retail sales and some boating services totaled $78.2 million, bringing in about $2.97 million in taxes. Reducing the taxes by a third would save buyers a million dollars.
The Department of Motor Vehicles reported that there are 108,094 registered boats in the state.
Frantz, who has sailed in races around the world, owns a 72-foot wooden ketch named Ticonderoga.
"I know everybody is going to point fingers and maybe laugh that I have three bills to cut tax rates," he told the Connecticut Post. "But if you reduce taxes and keep the commitment to keeping them down, it's amazing the way revenue can grow. Boating brings together families and could maybe bring a dramatic increase in revenues to the state of Connecticut."