Luxury tax included in Connecticut budget deal

April 2011 News

A state budget deal reached Wednesday in Connecticut does not hit boating as hard as an original plan, but it still includes a luxury tax on boats over $100,000, Grant Westerson, president of the Connecticut Marine Trades Association, told Soundings Trade Only.

"We're very pleased [with] the decisions that the legislature made. They did not impact boating as heavily as they initially were going to," he said. "They're not applying a property tax to boats, they're not going to take away the trade-in differential on sales tax, they're not going to take away the exemptions for winter storage and repair and maintenance on boating, but there is still going to be a 7 percent luxury tax for any boat sold over $100,000."

Westerson said the elimination of the property tax, which would have been an estimated $40 million hit to boaters in the Nutmeg State, was "the most important thing."

However, he added, "[Boating] will be obviously impacted because Rhode Island still has no sales tax - so now there's a 7 percent difference between Connecticut and Rhode Island. But the process is not over. We're still working on it."

The budget still needs legislative approval, with committee votes expected today, before it can go to the governor.

BoatU.S., meanwhile, is urging Connecticut boaters to let state lawmakers know that the new tax levies will hurt the marine industry in the Nutmeg State. Those interested can click here to send a message to their representative.

"We recognize that Connecticut is facing budget problems," BoatU.S. vice president of government affairs Margaret Podlich said in a statement. "However, this proposal has the potential to have a significant impact on recreational boating. The Connecticut legislature is under a deadline to act on the governor's budget bills (House Bill 6387 and Senate Bill 1007) by April 26."

In Connecticut, boaters already pay an array of taxes on parts and accessories, on wet or dry summer storage, on freight and on summer slip fees or moorings, and a 6 percent sales tax when a boat is sold. There is also a 6 percent "use" tax on a boat purchased out of state that is subsequently registered in Connecticut.

The budget proposals could easily cause people to move their boats to lower-cost states, such as Rhode Island, according to BoatU.S., affecting Connecticut marine businesses and employees such as boat mechanics, riggers, marina staff and dealers.

"Help your state legislators understand that boating is not the Hollywood stereotype of 'rich yachtsmen,' but is a wholesome outdoor activity enjoyed by hardworking families that keep over 500 Connecticut businesses in operation, employing over 4,500 people," Podlich added.

To learn more, visit

Click here for a Hartford Courant article on the proposed budget.
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