by Dom Wiseman

The NSW Labor Party has announced that if elected in the upcoming state election, it will impose a new stamp duty on boats over the value of $200,000. The announcement has sent a ripple of unease through the boating community, with the Boating Industry Association (BIA) predicting “devastating” consequences for the industry.

Specifically, the proposed tax will impose a duty of $7,600 on boats purchased for $200,000, increasing by $9 for every $100 above $200,000 and then $12 for every $100 over $300,000. A boat sold for $500,000 will now carry a duty of $40,000. The boating industry expects the tax to be damaging for the industry in its entirety and will see potential customers buying vessels outside of NSW.

To date, no stamp duty has been payable on boats. With the proposed stamp duty on boats and an increase on the existing luxury car duty, the Labor Party expects to raise approximately $240 million annually, of which it plans to spend on employing more nurses. Labor said it expects the duty to apply to the top 3% of boats sold.

In response, the Boating Industry Association (BIA) said in a statement that it was “surprised” by the announcement.

“The tax will drive sales and jobs way from NSW to other states and sadly, the perception that boats over the value of $200,000 are a tax on the wealthy is fundamentally wrong,” said Alan Blake, BIA president. “Many vessels of that value are owned by families, retirees, groups of hard-working, hard-saving mates who have grouped their savings to pursue their passion for being outdoors, or those who have joined in a share boat arrangement through a club.

“The proposed tax will hurt working families who enjoy boating and the many small businesses and their employees who service them.

“The knock-on effect of this proposal has not been taken into consideration by the Labor Party. The businesses that service, store or supply provisions for these vessels are small family businesses who will feel a direct impact of such a tax,” said Blake.

The boating industry disagrees with Labor’s industry figures and predicts the duty will impact the everyday Australian and not the wealthy. The BIA equally believe that the forecast revenue has been significantly overstated.

Brent Vaughan from Sydney broker Multihull Central blasted the policy as a “joke”, commenting that it will have a “devastating” effect on the industry.

“Having been involved with exporting boats from Australia for over a decade, it was clear during this time that countries with a luxury tax on yachts stopped sales into those countries dead in their tracks,” he said. “These taxes are more consistent with communist countries such as China where the recreational boating industry is very underwhelming as a result, despite the wealth and population.

“Luxury boats are also closely aligned with the tourism industry and we supply many new boats into charter fleets in the Whitsundays and Sydney Harbour. These fleets rely on current model boats to remain competitive in the global market place. So, in addition to cyclones and shark attacks, now the tourism industry is also subject to being attacked by the NSW state government!

“Most of our boats are purchased by retirees who have worked hard their entire life and often downsize their house or sell their business and chose to buy a yacht instead of a caravan and run them in charter fleets to help fund the expense of the boat. You might as well apply a tax to their house, business or caravan.

“Sadly, it will be people working in the marine and tourism that get hurt the most – not super-rich people – regular people such as trades people, sales reps, skippers, cleaners, fleet operators.”