The Marine Retailers Association of the Americas submitted joint comments to the Washington state Department of Revenue (DOR) challenging their proposed increase in the Watercraft Excise Tax depreciation schedule.
MRAA joined regional and national groups challenging this proposal such as BoatUS, Recreational Boating Association of Washington, Northwest Marine Trade Association, Washington Retail Association, and Washington Maritime Federation. The watercraft excise tax applies to all registered boats in Washington state that are 16 feet or longer or equipped with a motor capacity of more than 10 horsepower. The tax is paid annually and is currently 0.5% of the boat’s fair market value, however, the DOR is proposing to update the depreciation schedule which will ultimately result in boatowners paying more.
“While we greatly appreciate the Bureau of Revenue accepting comments on the proposed depreciation schedule, we hope that they can understand the burden this change will put on boat owners throughout the state,” Said Chad Tokowicz Government Relations Manager at the Marine Retailers Association of the Americas. “Boat owners in the state already pay their fair share through registration and other fees and according to 2019 data 61% of boat owners in America earn $70,000 a year or less.”
The proposed rule would create depreciation categories for powerboats, personal watercraft, and sailboats, and are much lower compared to depreciation data from the National Marine Manufacturers Association (NMMA). The proposed rule holds Year-1 depreciation rate of either 2 or 3% while data compiled by the NMMA shows 10% for Year-1 and ~5—10% for each year thereafter. Thus, boatowners in Washington state will be paying more in excise tax as the BOR is calculating the depreciation of their vessels at a lower rate than the national average.
Unlike private planes and RVs, boat owners are the only recreational user group to pay this percentage-based excise-tax in Washington state. Furthermore, Washington state boaters support and buy-in to programs like the Washington Department of Fish and Wildlife’s Aquatic Invasive Species program and the Department of Natural Resources Derelict Vessel Removal Program.
“When we got wind of this recommendation, NMTA and our partners like MRAA and RBAW jumped into action and advocated for boaters and boating businesses,” said Peter Schrappen Director of Government Affairs at the Northwest Marine Trades Association. “That’s what we do, and it was gratifying to have such an august coalition in place for this important issue.”
About the Marine Retailers Association of the Americas
At the Marine Retailers Association of the Americas, we believe that for the marine industry to thrive, the retail organizations that interact with the boaters in their community must thrive. With that in mind, MRAA works to create a strong and healthy boating industry by uniting those retailers, providing them with opportunities for improvement and growth, and representing them with a powerful voice. For more information, visit MRAA.com or contact us at 763-315-8043.
