Mcmillen To Protest Boat Tax, User Fee

October 18, 1991

Using the U.S. Powerboat Show as a backdrop, Representative Tom McMillen, D-4th, and boating enthusiasts will protest the federal luxury tax on new boats tomorrow.

McMillen, co-sponsor of measures to repeal the sales tax and the Coast Guard user fee, plans a 12:30 p.m. press conference at Annapolis City Dock.

The congressman will be joined by David Broom of the National Marine Manufacturers Association, George Brown, director of the Yacht Architects and Brokers Association, boat owners and sellers and industry employees.

"The boating industry has been hit hard this year with both the user fee and the new boat tax," McMillen said. "This single industry has been asked to bear an unfair burden in order to reducethe deficit. It's time for both of these measures to be repealed in the Congress."

McMillen is co-sponsor of the Boating Industry JobsPreservation Act, which would overturn the 10 percent tax on new boats costing more than $100,000. He also is co-sponsor of a measure to repeal the Coast Guard user fee, which imposes a fee of $25 to $100 on all boats over 16 feet.

During the 10 months the new boat tax has been in effect, boat dealers have seen severe drops in sales, forcing some to lay off workers.

"The intention seemed to be to tax those able to afford a boat or yacht, but it's really hurting the middleclass," McMillen said. "Instead of buying a new boat and paying the tax, people are just buying used boats or not buying boats at all. This is resulting in a depression-like environment among the small businesses and their workers that depend on the boating sales industry."

At least 50 Maryland boat dealerships closed in 1990, putting about 1,000 people out of work, said Mick Blackistone, former executive director of the Marine Trades Association of Maryland. He estimated that another 4,000 jobs may have been lost at retail stores, suppliers and boat-building yards.

Between 1990 and 1991, seven major Maryland boat dealers reported sales of boats over $100,000 dropped from $15.3 million to $3 million.

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