March 30, 2015 — New Jersey is charging boaters tens of thousands of dollars in taxes and fees, but two South Jersey lawmakers are sponsoring legislation that they hope will level the playing field for businesses who build or sell boats in the state.
Under current state law, the state’s 7 percent sales tax is imposed on those that purchase boats in New Jersey and those that live in New Jersey, but purchase a watercraft vehicle in another state. In addition, the state also imposes the 7 percent sales tax on out-of-state residents that keep a home in New Jersey as well.
State Senators Jeff Van Drew (D-Cape May Court House) and Jim Whelan (D-Northfield) introduced legislation on March 9 that would establish a sales tax cap on boat purchases at $20,000.
“In my mind, overtaxing causes diminishing returns. We want to keep them in New Jersey. We want to keep people building boats in New Jersey. We want those who recreate in New Jersey and fish in New Jersey to stay in New Jersey,” Van Drew said.
The sales tax can be bad for business, especially since many other states already have a sales tax cap on the books. For example, Florida caps sales tax on boat sales at $20,000.