The Northwest Marine Trades Association is calling for an immediate industry blitz against a proposed luxury tax in Washington state that would add 10% to the value above $500,000 on sales of boats and yachts. If passed, it would have a widespread negative impact on the marine industry.
Senate Bill 5801 is now being debated in Olympia. “Make no mistake, such a tax won’t just damage boatbuilders, dealers, suppliers and buyers; it will ripple through boatyards, marinas, small supply businesses, skilled trades and even tourism, many of which are already struggling,” said NMTA president George Harris. “Clearly, this tax will kill family wage jobs and wreck businesses.
“NMTA’s goal is to promote the growth of recreational boating and the businesses of our members,” he added. “Based on clear historic data, we know the proposed Washington state luxury boat tax will have a devastating impact on the marine industry, leading to job losses at every pay grade. Indeed, this unfairly targets recreational maritime, which already contributes $20-plus million annually in a value-based excise tax on boats, not to mention existing sales and property taxes that support state and local revenues.”
Yesterday, NMTA put out an early edition of its WaterLife newsletter stating the urgent need for an immediate industry response. “We’re asking you to join fellow coalition members who are letting legislators know right now that this tax will kill family wage jobs and wreck businesses,” Harris said.
Senate Bill 5801 essentially funds transportation projects through a variety of new taxes, including this 10% luxury tax on the value of new and used boat sales over $500K. Will it solve problems? Absolutely not, but it will surely kill good jobs.
“Indeed, the threat to our industry isn’t just rhetoric,” Harris said. “The past failure of such tax schemes to generate revenue, and the resulting elimination of good maritime jobs, is already proven with real-world precedents.”
In 1991, a federal luxury tax on boats caused a 77% drop in sales within a year and led to the loss of more than 25,000 jobs in the boatbuilding, maintenance and marina sectors. Grassroots pressure led by NMTA helped get it repealed. In 2022, Canada’s luxury tax resulted in an 85% drop in boat sales and a loss of more than CAD$211 million in the economy.
“We need to carry facts like these and the obvious danger to our current lawmakers in Olympia who may not be aware of the past, and we all need to do it right now,” Harris said.
NMTA is already on the attack. Along with coalition partners, the group recently hosted an industrywide virtual meeting to organize grassroots efforts and ensure organizations are aware and engaged. NMTA has also delivered, along with coalition partners, a detailed letter to targeted legislative leaders citing the past failures and repeals of similar federal and state taxes on boats, and urging opposition to SB 5801.
Read the full text of the letter here.
In addition, NMTA’s legislative team is bringing more than 85 years of combined experience at the capitol, led by Jay Jennings, NMTA’s vice president and director of government affairs (with lobbyists Roman Daniels-Brown and Jay Balasbas). They’re aggressively advocating against this policy at every possible face-to-face conversation with lawmakers.
What happens next?
• Senate Bill 5801 is currently in the House Transportation Committee. “We want it to stay there,” Harris said.
• On April, the Washington House passed its transportation budget, but not a funding package. In the next few days, the House and Senate will negotiate a transportation spending package full of road projects, and a funding bill full of taxes.
• The proposed luxury tax will require a majority vote in the House Transportation Committee to move forward.
• The entire industry needs to make sure legislators continue to feel the pressure to deep-six this proposal until the legislative session ends April 27.
“Every industry voice matters,” Harris said. “In 1991, it was NMTA and its members who were so instrumental in defeating the federal luxury tax. In fact, at that time, Washington Rep. Jim McDermott noted that during one voting session, his phone lines were so overwhelmed with calls from NMTA members that no one else could get through for two days.
“So let’s go wide-open throttle and do it again,” he said. “House and Senate Transportation Committee members, and especially your locally elected legislators, need to feel a steady and forceful drumbeat of opposition from you, their voters. Let them know of the devastating impacts this proposed tax will have on your business and the industry.”
Here’s a suggested message to send your lawmakers: I vote and I boat. Oppose the luxury tax!
Don’t delay. It’s crucial that the industry voice its concerns directly and repeatedly to state lawmakers and key members of the legislature and the governor’s office.
• Find your senator and representatives here.
• Rep. Jake Fey (D-Tacoma), House Transportation Committee Chair,(360) 786-7974. [email protected]
• Rep. Julia Reed (D-Seattle), House Transportation Committee Vice Chair & Maritime Caucus Chair, (360) 786-7814. [email protected]
• Rep. Adam Bernbaum (D-Olympic Peninsula), (360) 786-7916. [email protected]
• Rep. Dan Bronoske (D-Southern Pierce County), (360) 786-7958. [email protected]
• Rep. Greg Nance (D-Bainbridge), (360) 786-7842, [email protected]
• Rep. Joe Timmons (D-Bellingham), (360) 786-7854, [email protected]
• Rep. Adison Richards (D-Gig Harbor), (360) 786-7964, [email protected]
• Rep. Sharon Wylie (D-Vancouver), (360) 786-7924, [email protected]
• Sen. Curtis King (R-Yakima), Senate Transportation Committee, (360) 786-7626, [email protected]
• Gov. Bob Ferguson, (360) 902-4111, click here for contact form
The Washington marine industry generates more than $8.1 billion in economic impact and supports thousands of good-paying jobs statewide. No legislation that would impact this should ever be considered.
There will be an NMTA government affairs committee meeting April 10 at 10:30 a.m. (PT) for Contact Jay Jennings at [email protected] for the Zoom link. Use the subject line: GAC meeting access request.
