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Proposed state budget contains sales tax break for some yacht purchases

New York State lawmakers tucked sales tax exemptions

New York State lawmakers tucked sales tax exemptions for yachts into the proposed state budget. Photo Credit: iStock

ALBANY -- Lawmakers tucked sales tax exemptions for yachts into the state budget, sparking criticism from advocates for the poor and a spirited defense from marine dealers who said it was about competing with Florida for the luxury boat business.

Under the provision, sales tax would only be applied to the first $230,000 of a yacht's purchase price. Any amount above that would be tax-free.

Another provision would exempt general-aviation aircraft from state sales tax.

It's a case of "misplaced priorities," said Ron Deutsch of the labor-backed Fiscal Policy Institute.

"It appears our legislative leaders could not agree to provide tax relief to struggling homeowners and renters . . . but managed to find the political will to provide sales tax exemptions for people buying luxury yachts?" Deutsch said in an email.

But a Long Island boat dealer said New York has been losing luxury boat buyers to Florida, which capped the amount of sales tax a boat purchaser can pay at $18,000. The exemption would put New York on a par with Florida, said Jeff Strong, president of Strong's Marine in Port Washington and a member of the New York Marine Trades Association.

"You might at first think it's a benefit for the rich," Strong said. "But what is happening is that we are losing larger boat sales. A lot of people who are in that buying category are buying them in Florida, keeping them there in winter time and bringing them up here in summer. And the result is, New York dealers are losing sales and New York State is losing sales tax."

He credited Gov. Andrew M. Cuomo for "listening to the Marine Trades Association and trying to keep New York competitive."

Cuomo's office did not immediately comment.

The state Assembly approved a budget containing the yacht tax break late Monday night after a lengthy, heated debate.

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