By Chester Baldwin, Government Affairs Director, NYBA
The Northwest Yacht Broker’s Association (NYBA) is working in conjunction with the efforts of the Florida Yacht Broker’s Association (FYBA) to end the 107-year ban on the sales of foreign flagged boats to U.S. residents while in U.S. waters.
FYBA has introduced HR 4065 in the US House of Representatives. Currently, boats under a cruising license, while in U.S. waters, are forbidden to offer their boats for sale to U.S. residents until the boat is imported and duty is paid on the appraised value. This bill would remove the current restrictions and allow used foreign flagged boats to be put up for sale to U.S. residents while in U.S. waters and the taxes would be paid immediately upon sale.
Currently, only U.S. residents are prohibited from viewing these boats while in U.S. waters; this is like having your house for sale only to foreign buyers while prohibiting American buyers the ability to view or purchase the house.
The current cruising license policy is discouraging about $2.46 billion in U.S. economic activity that could be generating thousands of well-paying American jobs. Typically, there are 300-400 used boats on the market (valued in excess of $2 billion) that cannot be offered for sale to U.S. residents while in U.S. waters. Each of these boats spends an average 10% of its value annually on labor, goods, services, and maintenance contributing about $200 million yearly to the local economy. Additionally, new buyers typically spend an additional 13% of the selling price on upgrades and improvements in the first year of ownership.
A less restrictive cruising license, which allows used foreign flagged boats to be offered for sale to U.S. residents while in U.S. waters would benefit American marine industry workers and generate additional state and federal tax revenue. Removing the restriction to offer for sale will encourage more used foreign-flagged vessels to visit the U.S., offering their vessels for sale creating well-paying American jobs.
Congressman Dave Reichert in Key Position – This bill has been referred to the US House Ways and Means Committee and specifically to the House Subcommittee on Trade. Fortunately, Congressman Dave Reichert (R) from Washington’s 8th District has been appointed to serve as the Chairman of the Subcommittee on Trade. That means that Congressman Reichert has significant influence on whether this bill can gain the necessary traction and support.