Boat Tax cut could be part of final budget


With just two full days remaining in the General Assembly session, top leaders from both parties are just starting to negotiate an agreement to balance the books. 

Both sides say they are close. 

One possible development is a cut or the elimination of a tax that has a major impact on shoreline businesses: The sales tax on boat sales, maintenance and repairs.

The two sides are not that far apart on saving things like the Medicare Savings Program, municipal aid, and avoiding those rail and bus fare hikes, and there is bipartisan support on the boating industry
that has specific impact on the shoreline.

There are over 500 mostly small companies involved in Connecticut’s marine trades along the shoreline, rivers and lakes.

About 7,000 Connecticut residents are employed selling, maintaining, repairing and docking boats of all sizes. That number is down several thousand from just ten years ago, and so is the number of boats that are kept here. 

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The owners of those businesses say it’s because Rhode Island charges no sales tax on boat sales, maintenance or docking, and New York has put a cap on their tax that’s much lower than Connecticut’s 6.35%.

“Overall, boat sales in Connecticut are down 9% from last year alone and we’ve lost about 18,000 boats to other states in the last seven years,” said Rick Dieterich of Springline Yacht Sales of Mystic.

Dozens of owners and employees in Connecticut’s marine trades flocked to the Capitol on Monday wearing shirts with the slogan, “Don’t let out boat jobs sail away.” They’re hoping that a bill to cut or eliminate the boat tax will be part of the final state budget agreement, and that it would actually increase sales tax revenues.

Hal Slater of Brewer Yacht Sales in Branford said, “It’s restaurants, gas stations, this reduction in sales tax will generate a net profit in sales tax revenue for the state.”

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The cut would cost the state about $5 million the first year but despite that it has support from both sides of the aisle. 

“I don’t think it properly reflects the amount of new business we would get that would actually stay in Connecticut instead of going to Rhode Island or New York,” said Democratic Majority Leader Sen. Bob Duff (D-Norwalk).

Senate Deputy Republican Leader Sen. Scott Frantz (R-Greenwich) added, “This is necessary to prevent the demise of this industry which has seen its ranks reduced by roughly 50%.”

The boating industry has been pushing this for the past couple of years as many boaters take their business to the adjoining states.

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