SUPERYACHTS WILL SOON BE ALLOWED TO STAY IN WASHINGTON WATERS - TAX FREE - FOR 180 DAYS

The Washington maritime industry is celebrating the passage of the Marine Tourism Bill, which, after more than four years, passed the state House of Representatives in special session late Tuesday night. It has been sent on to Gov. Jay Inslee for his signature.


The law, which, if signed, will go into effect Sept. 1, allows yachts registered as an LLC – as most super yachts are – to stay in Washington waters 180 days before a 10 percent tax on the value of the boat is imposed by the state of Washington.


In the past, that tax would be imposed after an LLC-registered or entity owned vessel stayed more than 60 days. The tax is imposed whether the yachts are built here or just visiting.

Smaller, individually owned boats already get to stick around 180 days before they are taxed on their value.


A super yacht is generally considered to be more than 78 feet long.


“That’s fabulous news,” said Greg Mosely, owner of LaCasse Maritime, the largest vessel agency on the West Coast. “It’s a victory for not only for marine-related business but for the region in general. Because the big boats are more welcomed to stay here, it puts us on a level playing field with states offering the same services."


“I am walking on air,” says Peter Schrappen, vice president of the Northwest Marine Trade Association. “We had a lot of people rowing all in the same direction, so everything finally lined up for us."


Schrappen credited Sen . Barbara Bailey, R-Camano Island, and Rep. Steve Tharinger, D-Dungeness, the prime sponsors of the bipartisan bill; the Recreational Boating Association of Washington; Washington Maritime Federation; Visit Seattle; Washington Public Ports Association; chambers of commerce statewide, city councils and port commissions.


"It was a team effort,” he said.


Schrappen estimates the state will see $30 million in new revenue with this change, which includes payroll, taxes, restaurant, fuel, groceries, all the goods and services that go with keeping a boat afloat.


“It’s working people in this state who will benefit from this change, not the yacht owner with the pretty white boat," he said. "I think yachts are perceived as a tax break for the rich. In reality they are out-of-state businesses that want to come and spend big money in our state. They have gigantic spending potential.”


The U.S. Superyacht Association suggests that total annual expenses for a 180-foot yacht amount to $4.75 million, with $250,000 injected into the local economy by guests and crew on a visit.


The bigger the boat, the more spending. One maritime executive called it a kind of a "floating economic stimulus package."


And Dwight Jones, general manager of Elliott Bay Marina, is thrilled.


“It’s a huge step forward. Finally the West Coast is figuring out that there is big business in boating,” Jones said.


Jones said East Coast states keep increasing incentives for mega-yachts to come.


“We need to keep doing that,” he said. “We have built the facilities to handle these big yachts, but most haven’t come in because they were not allowed to stay more than 60 days without being penalized. Now it is our job as an industry to promote and advertise this new change (that will allow boats to stay six months,) so we can all reap the economic value. It’s up to us to get out the word.”


Jones says it has been a slow season for yachts coming to Seattle this year.


“Right now we only have a 120-footer, but now we can hope for many more," he said. "I say hats off to Peter Schrappen and the Marine Trade Association. A lot of organizations wouldn’t have had the fortitude to stick with it. That speaks well for them.”


The governor is expected to sign the bill soon.