Florida Yacht Brokers Seek Import Law Change

May 18, 2015

The Florida Yacht Brokers Association is seeking a change in a century-old federal law to make it easier for foreign-flagged yachts visiting the United States to be sold to Americans.

According to proponents, he change would make hundreds more pre-owned yachts readily available to U.S. buyers, expanding business opportunities for U.S. yacht brokers and U.S. boatyards that service yachts.

Increased sales of the foreign-flagged yachts also should boost taxes paid to the federal government.

“This is revenue that the U.S. could be getting that it’s now missing because of antiquated laws,” said Jeff Erdmann, who leads legislative affairs for the Florida brokers. He’s part of a team in Washington, D.C., this week for the annual American Boating Congress and talks with members of Congress.

Under current law, foreign-flagged yachts visiting U.S. waters can’t be sold to U.S. buyers in most cases, unless U.S. import duty is paid first.

The brokers want the import tax to be paid at the time of sale, not before, similar to the way that import taxes are paid on yachts sold in Europe.

That shift stands to add roughly 300 to 400 foreign-flagged yachts that regular ply U.S. waters to the market open to U.S. buyers. That’s an extra $2 billion in yachts for U.S. brokers to sell at any one time, Erdmann said.

“Florida ranks as the top state for boating, so Florida brokers could gain handily from those added offerings. And because buyers tend to send yachts after purchase for customization and upgrades, Florida boatyards also would be poised for millions of dollars in extra business,” Erdmann said.

In addition, more foreign yachts plying U.S. waters should mean greater spending on U.S. goods and services, from food for crews to maintenance.

“The import duty on foreign-flagged yachts generally runs 1.5%,” said Erdmann.

Boating proponents plan to meet on Capitol Hill this week with more than a dozen members of Florida delegation, including Rep. Lois Frankel, D-West Palm Beach, a strong advocate for the state’s seaports and boating industry. Frankel’s office already is looking into the import tax issue, a spokeswoman said.

Jason Dunbar, vice president of Luke Brown Yachts in Fort Lauderdale, is among Florida yacht brokers making the rounds in Washington. He sees the change helping sales of foreign-flagged yachts 65′ and longer and priced at $1 million and up.

Florida’s boating industry has its largest hub in Broward, Miami-Dade, and Palm Beach counties. A study by marine consultants Thomas J. Murray & Associates estimated that the marine industry in 2014 had an $11.5 billion economic impact and supported 136,000 jobs in the tri-county area.

Source: Doreen Hemlock, Sun Sentinel