Potential boaters in the market for a new vessel in New Jersey could get a 50 percent break on the sales tax under a bill that the Senate is expected to vote on Thursday.
Gov. Chris Christie proposed slashing the state's 7 percent sales tax on boats by half after vetoing an earlier proposal that would have capped the tax at $20,000. That measure would have provided relief on boats that cost more than $285,000.
The National Marine Manufacturers Association says such high-priced boats were only a slim fraction of the $160 million in new boat sales made in the state last year.
Lawmakers said they had proposed their legislation because marinas and other boat retailers along the state's coast were suffering because of Superstorm Sandy and competition from other states with lower taxes.
The tax break under the vetoed legislation could have cost the state between $1 million and $4 million, according to the latest legislative estimates. Estimates for Christie's proposal are not yet available, but he said it was better because it would also help middle-class residents who buy smaller vessels.
The original bill also included a change to the 7 percent tax on use of boats that were bought in other states but operated in-state. The Legislature's bill would have waived the tax on boats used in the state for fewer than 90 days per year.
Christie proposed changing the period to 30 days to ensure the use tax is enforceable.
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The issue comes to the foreground as Christie spends time outside New Jersey seeking the Republican nomination for president.
Political experts say it's impossible to look at a potential tax cut without applying the filter of the presidential race.
Christie, though, cast the issue as a boost to the state's struggling economy.
"Lowering taxes on New Jersey residents and supporting the continued economic growth of our shore communities following the impact of Superstorm Sandy are laudable goals," Christie said in a statement.
