Tax cut on N.J. boat sales now awaits Christie’s approval

TRENTON — New Jersey is now one step away from granting a tax break to those who buy boats in the state. 

The state Assembly voted 64-0 on Thursday to give final legislative approval to a bill that would reduce the sales tax on all boats bought in the Garden State by 50 percent. 

The measure would also cap the amount of sales or use tax that can be imposed on yacht sales at $20,000.

The bill now heads to Gov. Chris Christie‘s desk for approval — and it appears likely the governor will sign it. He’s the one who suggested the state Legislature should broaden the measure by slashing the 7 percent sales tax in half to help more potential buyers.

Though critics have said the bill would help only a small percentage of people at the expense of taxpayers, sponsors of the legislation said it would give a boost to New Jersey’s boating and marine industry, which is still recovering from Hurricane Sandy.

RELATED: Christie’s call for 50% tax cut on boat sales approved by N.J. Senate

“We have the ability to strengthen the industry, but we have to make the necessary changes to do that,” state Sen. Jeff Van Drew (D-Cape May) said. “The fact is that we can’t expect to increase sales and expand production of boats in the state if we don’t make our laws and ultimately the final purchasing price more attractive to buyers.”

Both houses of the Democratic-controlled Legislature voted in June to pass the original version of the measure (S2784), which would have only capped the sales tax on yachts at $20,000

But in his conditional veto of the bill, Christie — a Republican presidential candidate — noted that would have given relief only for those who buy high-end boats for more than $286,000.

Instead, the governor proposed cutting the 7 percent sales tax on all boats by 50 percent to also help “individuals, including middle-class citizens, who purchase smaller boats.”

The state Senate voted 33-1 to approve the new measure in September, and the Assembly followed suit Thursday.

But Gordon MacInnes, president of liberal think tank New Jersey Policy Perspective, said the tax break is misguided, giving the biggest benefit to those who buy yachts.

“While New Jersey’s working families continue to suffer in a stagnant economy with rising costs of essentials like transportation, housing and higher education, New Jersey’s leaders have decided that the folks who really need help are those buying pleasure boats for their weekends,” MacInnes said in a statement Thursday. “This silly tax break — designed to benefit a very few at the expense of the rest of us — is a step in the wrong direction.”

Brent Johnson may be reached at bjohnson@njadvancemedia.com. Follow him on Twitter @johnsb01. Find NJ.com Politics on Facebook.


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