Texas considers tax breaks for yachts - Trade Only Today

Texas considers tax breaks for yachts

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A Texas lawmaker is floating the idea of a tax break for yachts, saying the state needs such incentives to keep up with Florida.

"We're losing our yacht sales in Texas to Florida," Republican Rep. John Davis, whose House Bill 2187 first caught the eye of the Texas Observer and has since been discussed on Sean Hannity's website, told the San Antonio Express News.

Davis said it's not so much a big break for yacht owners as an effort to keep the economic activity surrounding the vessels, including repairs and boat slip fees.

"We're losing a lot of downstream jobs and sales tax revenue," he said, because Florida has limited sales taxes on yachts to $18,000.

Davis' bill, as filed, would limit the amount of boat tax to $15,625 - the amount normally due on a $250,000 vessel - regardless of the sales price.

A fiscal analysis of the original bill said it would cost Texas $1.4 million annually in lost tax revenue, but supporters, including yacht brokers, note that the figure doesn't take into account the ripple effect of Texas losing yachts.

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