Finance, Revenue and Bonding Committee

JOINT FAVORABLE REPORT

Bill No.:

HB-6576

Title:

AN ACT CONCERNING THE APPLICABILTY OF THE SALES AND USE TAX TO BOATS.

Vote Date:

4/4/2013

Vote Action:

Joint Favorable Substitute

PH Date:

3/11/2013

File No.:

SPONSORS OF BILL:

Finance Revenue and Bonding Committee

REASONS FOR BILL:

The bill seeks to extend the sales tax exemption for winter storage of noncommercial vessels by two months and use tax exemption by one month for winter storage, maintenance, and repair of vessels brought into the state exclusively to encourage more winter storage. The Storage period would now be October 1- May 31st.

RESPONSE FROM ADMINISTRATION/AGENCY:

Benjamin Barnes, Secretary, Office of Policy and Management, State of Connecticut, explained the bill will extend the period of the sales and used tax for winter boat storages and that the state can't afford to do so because of the significant financial challenges, the administration cannot support extending the tax exemptions in this economic climate.

NATURE AND SOURCES OF SUPPORT:

Senator Andrew M. Maynard, District 18, expressed that HB 6576 would take steps to level the playing field and relieve the competitive disadvantage many small businesses now experience. Senator Maynard appreciates that the bill clarifies that “An owner can have a boat berthed in this state for up to sixty days without having to go through the registration process.”

Connecticut Conference of Municipalities (CCM), conveyed that HB 6576 would help offset a portion of the substantial investment being made by local government and their residential and business property taxpayers, which will aid them in making the needed upgrades to meet new thresholds.

Connecticut Marine Trades Association (CMTA, spoke in support of HB 6576 , it's a valuable initiative offering to regenerate revenue and encouraging sales of vessels and especially additional outfitting and accessorizing on all vessels within Connecticut. That makes this a revenue bill and a jobs bill and everyone wins.

Robert Petzold, Owner, Petzold's Marine Center, submitted testimony in support of HB 6576. He indicated two important components of the bill, which are not only crucial to maintaining the success of his business, but also insuring potential additional revenue for the State of Connecticut. The first component stretches the current winter storage window by an additional two months, allowing the out of state boaters to bring their boat into the state free of the sales and use taxation. The second component is equally important which allow boats either locally owned, or out of state owned, to come into the state for a period , not exceeding sixty days, without fear of being subjected to a sale and or use tax.

NATURE AND SOURCES OF OPPOSITION:

None Expressed

Reported by: Kenneth L. McClary

Date: 4/05/2013