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New luxury yacht tax in Canada


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The government just announced a new tax of 20% of the retail price of a yacht over and above $250,000.  So anyone buying a $1 million yacht will pay an extra $150,000.    Thankfully, it's not something I'll ever have to worry about.

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You do not have a clue WTF you are talking about. I was in the business back then and it resulted in the layoff of 3/4s of the blue collar working people at our shop and many others. The rich people g

But no one will pay it. No one did last time. This would just be the "hide your boat in Annapolis or Miami" law. Every rich(ish) person I know would be more than happy to pay someone $149,999.99

Cross border personality disorder. Damned contagious, I tell you.

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Almost nobody will pay it. Yachts between $250,000 and $1,000,000 will get taxed. More expensive yachts will be purchased offshore. The wealthy skate while easily targeted yachties get hammered. Is the tax only yachts...not jets, ski chalets, diamond rings,designer handbags, etc?

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https://www.cbc.ca/news/business/budget-tax-1.5993593

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But Big Tech executives aren't the only members of the 1 per cent who should be expecting higher tax bills. Owners of costly playthings like luxury cars, planes and boats are being hit with a new tax — of up to 20 per cent on cars and planes worth more than $100,000, and on boats worth more than $250,000.

The one time sales tax will be either 20 per cent of the value of the vehicle above that threshold, or 10 per cent of the total value, whatever is lower.

 

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Politicians: cutting taxes and making sweetheart loans available to move more minimum wage jobs into their districts

Also politicians: adding populist taxes to luxury toys that employ highly skilled workers

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53 minutes ago, apophenia said:

Politicians: cutting taxes and making sweetheart loans available to move more minimum wage jobs into their districts

Also politicians: adding populist taxes to luxury toys that employ highly skilled workers

Probably the only way they can tax the 1%, who move their wealth to offshore tax havens.  Canada has an atrocious record of failing to go after tax cheats.  I guess the problem now is that the 1% will just register their boats in Panama or Bermuda.  

Interesting that they went after gliders as part of the aircraft tax.  They must have noticed that new gliders are now in the $150-$250K range.

https://www.ctvnews.ca/politics/luxury-tax-on-yachts-cars-and-personal-aircraft-laid-out-in-new-federal-budget-1.5393511

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easy way to get around it - buy a used boat (if you can find one these days).  Or as mentioned, the superyacht crowd will just keep the boat offshore.  Folks already do that now - they have a beater on the lakes and keep something nice down south or in Florida.  

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Just ridiculous... but unsurprising from the government that brought in the (thankfully since reversed) 10% tariff on used boats imported from the USA.

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If you've been lucky enough, or smart enough, or hard-working enough, to afford to spend $100,000 on a car, or $250,000 on a boat – congratulations! And thank you for contributing a little bit of that good fortune to help heal the wounds of COVID and invest in our future collective prosperity.

 

Their wording is "suitable for personal use" so we'll see what they come up with - charter arrangements might still be subject to it, even if owned by a business.

Hitting aircraft >$100k is also a huge slap in the face to general aviation, where it will apply to 100% of new aircraft sales, many of which go to flight schools, partnerships, co-ops, etc - very middle class users.


https://www.budget.gc.ca/2021/report-rapport/anx6-en.html#tax-on-select-luxury-goods

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It was tried in the USA with not such good results.  Jobs and revenue fell.  Boat builders went out of business.  

"Those that do not learn from history are doomed to repeat it."

https://www.wsj.com/articles/SB1041807729976794664

https://www.aei.org/carpe-diem/the-lesson-of-economic-damage-from-taxing-the-rich-with-the-punitive-luxury-tax-in-the-1990s/

 

 

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Luxury taxes have been applied elsewhere, I recall it just about killed boatbuilding in NZ a few decades back, I recall they tried the same thing in the US late 80's early 90's, in Rhode Is. it was an unmitigated disaster with many local marine related businesses hitting the wall.

Trying to tax this is like cutting you nose off to spite your face, the locals on the ground get hurt and the really wealthy just go somewhere else to build, buy and service their Cayman Is registered toys.

Shortsighted pollies that do this shit really need to learn from others before repeating the clusterfuck this will become.

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34 minutes ago, robalex117 said:

It was tried in the USA with not such good results.  Jobs and revenue fell.  Boat builders went out of business.  

"Those that do not learn from history are doomed to repeat it."

https://www.wsj.com/articles/SB1041807729976794664

https://www.aei.org/carpe-diem/the-lesson-of-economic-damage-from-taxing-the-rich-with-the-punitive-luxury-tax-in-the-1990s/

 

 

I worked in the biz when that happened. Thanks Mr. Bush for signking that one in (not).  30,000 jobs in NJ alone. Multpiple longstanding US boatbuilders went bankrupt and were then bought up by foreign interests. That's where all the Italian and other yards came into the U.S. yacht biz.

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30 minutes ago, Navig8tor said:

Luxury taxes have been applied elsewhere, I recall it just about killed boatbuilding in NZ a few decades back, I recall they tried the same thing in the US late 80's early 90's, in Rhode Is. it was an unmitigated disaster with many local marine related businesses hitting the wall.

Trying to tax this is like cutting you nose off to spite your face, the locals on the ground get hurt and the really wealthy just go somewhere else to build, buy and service their Cayman Is registered toys.

Shortsighted pollies that do this shit really need to learn from others before repeating the clusterfuck this will become.

The problem is the politicos don't actually give a fucking goddam about the bad consequences. It is all about the "base". The "base" loves them for it.

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20 minutes ago, fastyacht said:

The problem is the politicos don't actually give a fucking goddam about the bad consequences. It is all about the "base". The "base" loves them for it.

Well until their voters realize that one or two pollies have single handedly killed off an entire local industry that usually makes them pull their horns in or of course they piss off some Uber wealthy captain of industry that just happens to have a superyacht and  some serious interests in the marine/aviation business sector that usually leads to a pretty short political career as well.

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The upside is that there's no yacht building industry left in Canada to be affected by this - the last time they applied this strategy killed them all off.

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4 hours ago, Rain Man said:

Canada has an atrocious record of failing to go after tax cheats

The US has ya beat six ways from Sunday. 

We lose an est. $ ONE TRILLION per year to tax cheats. 

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3 hours ago, robalex117 said:

It was tried in the USA with not such good results.  Jobs and revenue fell.

Oh yeah, we best stick with soaking the working poor. 

It's what we know best. 

(Much of the above is Reich Wing mythology every bit as implausible as the 

assertion that Barney Frank caused the 2008 melt-down.) 

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The UK back in the 1970's the labour party suddenly changed taxes from being a flat rate 10% on all goods (except food and a few minor things which are not taxed) to having a 25% luxury tax. Boats of course were included, it wasn't on high value stuff either a single part for your rigging would be included in the tax.. It destroyed a lot of businesses and badly damaged those that survived..

 

Unfortunately they seem to be proposing it again.. Luckily they're not in power at the moment..

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8 hours ago, fastyacht said:

I worked in the biz when that happened. Thanks Mr. Bush for signking that one in (not).  30,000 jobs in NJ alone. Multpiple longstanding US boatbuilders went bankrupt and were then bought up by foreign interests. That's where all the Italian and other yards came into the U.S. yacht biz.

The revenue hit to many shops in Annapolis was something like 60-75% :o

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4 hours ago, AJ Oliver said:

Oh yeah, we best stick with soaking the working poor. 

It's what we know best. 

(Much of the above is Reich Wing mythology every bit as implausible as the 

assertion that Barney Frank caused the 2008 melt-down.) 

You do not have a clue WTF you are talking about. I was in the business back then and it resulted in the layoff of 3/4s of the blue collar working people at our shop and many others. The rich people got along regardless, the working class were the ones that got a royal screwing. That tax hardly even collected anything, people bought used boats or registered them in the Caymans or just kept their boats. It was a money LOSER for the government and put many a working man out on the street.

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5 hours ago, AJ Oliver said:

The US has ya beat six ways from Sunday. 

We lose an est. $ ONE TRILLION per year to tax cheats. 

I agree.  I think we should change our tax system to be split between a flat tax and a vat tax.  So if before the income tax collected $100 via income, you would collect $50 via flat tax and $50 via a vat.  That would keep everybody paying especially the cash economy.  Rates would need to be set to be revenue neutral.  Certain incomes lets say under $40,000 would be except from the flat income tax.  

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19 minutes ago, kent_island_sailor said:

You do not have a clue WTF you are talking about. I was in the business back then and it resulted in the layoff of 3/4s of the blue collar working people at our shop and many others. The rich people got along regardless, the working class were the ones that got a royal screwing. That tax hardly even collected anything, people bought used boats or registered them in the Caymans or just kept their boats. It was a money LOSER for the government and put many a working man out on the street.

Maybe taxing income is more progressive than taxing consumption?

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21 minutes ago, Ease the sheet. said:

Maybe taxing income is more progressive than taxing consumption?

The advantage is its effect on economic interaction is essentially neutral.

Suddenly taxing one type of consumption over another is fundamentally NOT about tax revenue it is punishment. Yet the morons on the political class fuck it up over and over and misunferstand who is veing punished.

Tarriffs very much same dynamic (with some signif diffs too ... Realpolitik)

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What is especially egregious about luxury tax is that it ALWAYS punishes the snot out of small businesses that are actually home grown. Every time they happen the big Internationalists (both the commies as well as the capitalists) say, "YES!"

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Our luxury tax had the luxury of destroying many New Jersey Boat builders for sure. I was supposed to learn the trade at the exact time they all shut down. It sucked.

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1 minute ago, Sail4beer said:

Our luxury tax had the luxury of destroying many New Jersey Boat builders for sure. I was supposed to learn the trade at the exact time they all shut down. It sucked.

I went off and built little racing dinghies.

Note that Genmar and Brunswick were unaffected...fucking pols only listen to major corporate.

Palmer Johnson, Burger, Bertram, Egg Harbor, Trojan, the list of US companies adversely affected and or ultimately bought by foreign interests is long.

It had a profound ever lasting effect. This is what politicians do...fuck it up at taxpayer expense.

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Yep, and here I get to be surrounded by a dearth of opportunity in the marine trade as a result. Silverton and Luhrs are just 2 of the local builders who let their workforce go in the 90’s. Somehow Henriques survived and built many sport fishing boats.  
If something is too good to be true, politicians will tax it until it fails. Now I’m stuck repairing boats instead of building them:angry:

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All politicians r or b are pieces of mouldering dogshit.

In voting it is best to think about which shit smells worse and sticks to your soles more.

Make no mistake though: either way you are going to be into the shit.

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9 hours ago, fastyacht said:

The problem is the politicos don't actually give a fucking goddam about the bad consequences. It is all about the "base". The "base" loves them for it.

Optics.
Because we as a people vote emotionally, rather than logically, everything becomes about appearances, rather than substance.
Along with that we get absolutely nothing accomplished, but we look damn good doing it.

The Luxury Tax in the US, which if I recall correctly was anything over $100K, absolutely crushed the marine industry.

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Bush ended his political career on it.

Politicos have zero forethought. Reaction of owners was, "this tax will not last. I will wait to buy my new boat."

So that was that...

I cannot say it strongly enough: fucking with consumption side taxes does more harm than good. I am not even sure tobacco tax worked. Think about it: gubmint came to depend on that revenue!!!!!

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Sadly at this point the US government is not funding its expenditures with taxes, rather with an artificial economy based on zero percent interest rates and printing money. Covid has been at best a fortuitous excuse for the printing which was going to happen anyway and also served to dramatically slow the velocity of money. 

Taxation is now just being used for social engineering as the debt cycle ends. It is a sad thing to see the nature of government seems to be the abuse of power and management of resources. Realize also that printing money is a form of "silent" taxation that steals wealth primarily from the middle and lower class through the debauchment of the currency. This statement is based on what Keynes himself said of excessive "stimulus." 

The Canadian announcement of this luxury tax is just Kabuki theater. 

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1 hour ago, quod umbra said:

Optics.
Because we as a people vote emotionally, rather than logically, everything becomes about appearances, rather than substance.
Along with that we get absolutely nothing accomplished, but we look damn good doing it.

The Luxury Tax in the US, which if I recall correctly was anything over $100K, absolutely crushed the marine industry in North America.

fify.

 i was working for a Canadian builder at the time. we only barely made it through because we were building a good, unique yacht.

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12 hours ago, KC64000 said:

easy way to get around it - buy a used boat (if you can find one these days).  Or as mentioned, the superyacht crowd will just keep the boat offshore.  Folks already do that now - they have a beater on the lakes and keep something nice down south or in Florida.  

I don't think that's the way it works. I think the tax is on the object (plane, boat, car or whatever) regardless of the age of the object. If it's in Canada it will get taxed. If the owner is a foreign corporation there will be a "use tax" which becomes due a certain amount of time after when the object first entered Canada.

What will be interesting will be the "one time only" aspect of the tax: will dealers (of planes, boats cars or whatever) get to defer the tax until the object is sold or will they be immediately taxed on their existing inventory. I think that maybe this is what "Eastern Motors" was referring to above  when he alluded to the concept of buyers becoming dealers and thereby deferring the tax but that would be predicated upon a tax deferment option being included in the legislation.

Are there any Canadian airlines, cruise lines or F1/NASCAR teams?

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"Jack up the gas cap. Replace the car." I wonder if clever yachties can buy some derelict and do a restoration ... in carbon ... 20 feet longer ...

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In my state in US there is a yearly excise tax on boats, so you pay sales tax up front, then every year after. This is separate from licensing fees, which are steep. The local government is now proposing to double the yearly tax on all boats, even boats on trailers that also have to pay a yearly road tax. There is no similar tax on RVs or other luxury vehicles. We have a robust marine industry that employs a lot of individuals. As the costs of boats go up, less people will keep them, this is true of any consumer product. Not only will the local economy struggle, but I suspect the loss tax revenue from sales etc could result in a net loss for the tax collector.

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16 hours ago, Foolish said:

The government just announced a new tax of 20% of the retail price of a yacht over and above $250,000.  So anyone buying a $1 million yacht will pay an extra $150,000.    Thankfully, it's not something I'll ever have to worry about.

For further context, I believe it was part of the federal budget presented to the House of Commons yesterday.

It still needs to be voted on and hasn't actually passed yet. 

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10 hours ago, SloopJonB said:

The upside is that there's no yacht building industry left in Canada to be affected by this - the last time they applied this strategy killed them all off.

Dare I say it:  if this is how to kill a manufacturing industry, maybe a 100% tax should be applied to gunz?

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Article below about the 1990ish luxury tax - 

there was a recession at that time as well . . 

Hmmm, if the tax wrecked the boating industry, why did it not also wreck the fur, car, and jewelry industries ?? 

One reason governments wind up taxing luxury goods is that the rich are so good at hiding income 

Further on the relationship between the luxury tax and the decline of the boating industry: correlation is not causation. 

https://www.sun-sentinel.com/news/fl-xpm-1992-07-07-9202180334-story.html

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I would love to understand the logic behind $250k on boats and $100k on planes and cars. We really do not have significant manufacturing in any of these sectors - a few boat builders Kanter and Gozzard come to mind.. I think this is largely a symbolic measure and does distract attention from other aspects of this massive budget. As to getting the budget passed, the luxury tax would make it easier for the NDP to support the minority Liberals.

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32 minutes ago, AJ Oliver said:

Article below about the 1990ish luxury tax - 

there was a recession at that time as well . . 

Hmmm, if the tax wrecked the boating industry, why did it not also wreck the fur, car, and jewelry industries ?? 

One reason governments wind up taxing luxury goods is that the rich are so good at hiding income 

Further on the relationship between the luxury tax and the decline of the boating industry: correlation is not causation. 

https://www.sun-sentinel.com/news/fl-xpm-1992-07-07-9202180334-story.html

Blah blah. I was there. Sorry, it was definitely causatiion.

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43 minutes ago, AJ Oliver said:

Article below about the 1990ish luxury tax - 

there was a recession at that time as well . . 

Hmmm, if the tax wrecked the boating industry, why did it not also wreck the fur, car, and jewelry industries ?? 

One reason governments wind up taxing luxury goods is that the rich are so good at hiding income 

Further on the relationship between the luxury tax and the decline of the boating industry: correlation is not causation. 

https://www.sun-sentinel.com/news/fl-xpm-1992-07-07-9202180334-story.html

I think there is a differnece in buying a $100K car and a  lets say $2,000,000 boat.  People do really need the car and do purchase them somewhat locally.  Same with jewelry.  But for expensive boats some more then $2million first they are not necessary and the buyer can just wait, or more often purchase it overseas and register offshore.  

By the way New York and FL cap the sales tax now on boats, since they have figured out that getting something is much better then getting a big ZERO dollars in sales tax if they were not caped.  

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52 minutes ago, AJ Oliver said:

Article below about the 1990ish luxury tax - 

there was a recession at that time as well . . 

Hmmm, if the tax wrecked the boating industry, why did it not also wreck the fur, car, and jewelry industries ?? 

One reason governments wind up taxing luxury goods is that the rich are so good at hiding income 

Further on the relationship between the luxury tax and the decline of the boating industry: correlation is not causation. 

https://www.sun-sentinel.com/news/fl-xpm-1992-07-07-9202180334-story.html

We went from $1.5 million to $325,000 revenue in the space of a year. Outside whatever alternative universe you live in this misbegotten scheme took a chainsaw to marine businesses and put hard working people out on the street.

Rich people didn't even give a shit, their blind trust called their Panamanian banker who called his Swiss Banker who sold some bearer bonds and got a 100 foot yacht transfered from one trust to another trust in Grand Cayman. Regular old working people got it right up the ass.

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19 minutes ago, fastyacht said:

Blah blah. I was there. Sorry, it was definitely causatiion.

I think some guy could still afford to buy his lady a $25,000 mink coat and a $50,000 diamond ring. Probably decided to skip the luxury tax on a $1.5 million powerboat like all the other people with money to burn. Burning it’s ok, giving it to a stupid political stunt- no way.

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17 hours ago, Foolish said:

The government just announced a new tax of 20% of the retail price of a yacht over and above $250,000.  So anyone buying a $1 million yacht will pay an extra $150,000.    Thankfully, it's not something I'll ever have to worry about.

If you can afford a million dollar toy you can afford 150K tax

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5 minutes ago, jesposito said:

If you can afford a million dollar toy you can afford 150K tax

But no one will pay it. No one did last time. This would just be the "hide your boat in Annapolis or Miami" law.

Every rich(ish) person I know would be more than happy to pay someone $149,999.99 to find a way around a $150,000.00 tax.

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15 minutes ago, fastyacht said:

Having been through it I am amazed there is any debate. But I am sadly Not Amazed at the fools in Canadia doing it all over again.

Please do not look at this through the lens of American culture.  Although there are common behaviours, look at the Swedish attitude towards taxes as an indication (BBC has a recent article on this)  Some cultures see the responsibilities attached to paying taxes, something that is reflected in the attitudes in Canada to the Canadian Revenue Agency vs the US attitude to the IRS.  In other words, there is a filter to buying guns in Canada and a different view of taxes.

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26 minutes ago, jesposito said:

If you can afford a million dollar toy you can afford 150K tax

Yes of course you can but if it is perfectly legal to buy a $1million dollar toy and register it offshore and save $150K and say FU to the tax man that is what happens.  More so when the toy cost $5million.

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29 minutes ago, jesposito said:

If you can afford a million dollar toy you can afford 150K tax

You can, but the attitude was fuck no, I’m not getting price gouged by the government. Let them ruin the marine industry, I’m going offshore to buy.

That was the sad truth. Rich people didn’t just stop buying boats, they just bought them elsewhere. That’s why the US builders  tanked -because no one in their right mind was willing to pay the extortion and the builders’ overhead and lack of commissions drained them into poverty and property loss.

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21 minutes ago, Laker said:

Please do not look at this through the lens of American culture.  Although there are common behaviours, look at the Swedish attitude towards taxes as an indication (BBC has a recent article on this)  Some cultures see the responsibilities attached to paying taxes, something that is reflected in the attitudes in Canada to the Canadian Revenue Agency vs the US attitude to the IRS.  In other words, there is a filter to buying guns in Canada and a different view of taxes.

There is a big difference between a tax on EVERYONE and a tax on YOU. Income tax is the same for everyone at your income level and you choose what to spend it on. When you tax just certain things you are saying F U to just those people.

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22 minutes ago, Laker said:

Please do not look at this through the lens of American culture.  Although there are common behaviours, look at the Swedish attitude towards taxes as an indication (BBC has a recent article on this)  Some cultures see the responsibilities attached to paying taxes, something that is reflected in the attitudes in Canada to the Canadian Revenue Agency vs the US attitude to the IRS.  In other words, there is a filter to buying guns in Canada and a different view of taxes.

Good luck with that.

Tou cannot possibly be Canadian. L O L

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32 minutes ago, Sail4beer said:

 That’s why the US builders  tanked -because no one in their right mind was willing to pay the extortion and the builders’ overhead and lack of commissions drained them into poverty and property loss.

Are you certain that your assertion is true ?? The early 1990s were also the time during which sailing participation began to plummet, and it has continued to do so. And most of the decline was due to factors other than the tax.  Sailboat sales declined, including boats that were not subject to the tax (cost less than $ 100K). Back in the early 1990s you could buy a lot of boat for that much. 

Second point: As many of you know, the US (especially) has experienced alarming shifts upward in income and wealth - and you are advocating tax policies that will make it worse. 

I'm try to be civil here - hope I am succeeding. 

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1 minute ago, AJ Oliver said:

Are you certain that your assertion is true ?? The early 1990s were also the time during which sailing participation began to plummet, and it has continued to do so. And most of the decline was due to factors other than the tax.  Sailboat sales declined, including boats that were not subject to the tax (cost less than $ 100K). Back in the early 1990s you could buy a lot of boat for that much. 

Second point: As many of you know, the US (especially) has experienced alarming shifts upward in income and wealth - and you are advocating tax policies that will make it worse. 

I'm try to be civil here - hope I am succeeding. 

Notice that none of the builders I mentuoned upthread were sail oat bulders (except Pj).

Sailboats in 1992 were less than 10% of total market. Jet skis were ascendant. In the large boat segment sailbosts were tiny fraction.

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As for "tax policies that will make it worse, I consider that a near vacuous position.

Income tax is where the rubber meets the road. Has been ever since 1917 or so.

All luxury taxes hurt little guys serving patrons.

Period. And ill conceived sudden Draconian ones are fundamentally (arguably purposefullly so) damaging to small business and their employees. There is no slack in small biz.

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33 minutes ago, kent_island_sailor said:

There is a big difference between a tax on EVERYONE and a tax on YOU. Income tax is the same for everyone at your income level and you choose what to spend it on. When you tax just certain things you are saying F U to just those people.

This is the fundamental problem with this tax - it's blatantly unfair. It's saying "you spent $250k on a boat so you can afford to pay some extra money", while at the same time saying "you spent $250k on a motorhome, have fun, you get a special exception".

I'm nowhere near buying a boat to which this tax would apply, but it will still impact me when 20 years from now there's one less used boat to choose from because someone saw this tax and spent their money on something else (like a racecar, which again, has a special exception???)

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2 minutes ago, fastyacht said:

All luxury taxes hurt little guys serving patrons.

But that is true of all taxed. 

As a leftie, even i have to admit the old conservative economists adage is at least partly true .  .  

If you tax something, you get less of it. 

 

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Just now, AJ Oliver said:

But that is true of all taxed. 

As a leftie, even i have to admit the old conservative economists adage is at least partly true .  .  

If you tax something, you get less of it. 

 

But the point is that the luxury tax is punitive. It amounys to socialcengineering to favour grocers over shipwrights and draughtsmen

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I can already see the new business model. Here you go sir, enjoy your new 249,000 dollar yacht. I understand it’s a little basic. If you stop by next week, we’d be happy to modify it for you. Shouldn’t cost more than a few hundred thousand. 

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2 minutes ago, fastyacht said:

But the point is that the luxury tax is punitive. It amounys to socialcengineering

Social engineering just like fuel taxes and cigarette taxes, not to mention the outrageous tax on my Cabernet. 

All taxes are punitive. 

(Sorry for my typo above - first line should be "taxes".) 

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Here is a very good book on tax policy . . it has had an influence on progressive dems 

It is also readable and not overly long. 

In my view, all citizens have an obligation to inform themselves about tax policy. 

shopping?q=tbn:ANd9GcQVb2tdlTnj3pGRReYhx_NbJZLC1KzD-KUVNqoSuT5GikYaUpS5SJcyCr4QOwQSyUM79fq3Tdim8C26HKHpaiAht4n-aXeMw2HqSa3lY0MNPw1QR_IgX-fL&usqp=CAE

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16 hours ago, robalex117 said:

It was tried in the USA with not such good results.  Jobs and revenue fell.  Boat builders went out of business.  

"Those that do not learn from history are doomed to repeat it."

https://www.wsj.com/articles/SB1041807729976794664

https://www.aei.org/carpe-diem/the-lesson-of-economic-damage-from-taxing-the-rich-with-the-punitive-luxury-tax-in-the-1990s/

 

 

Yup, the little guys were the ones who paid with their jobs in the US.  How many US boatbuilders went under then?  Almost all of em, very few survived.  So the real losers were the front line workers.  

That was one of mental and physical midget Sen. Barbara Mikulski's brilliant pet projects.  What an idiot.

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You misunderstand Canucks.  Yes we are not Americans and we accept higher taxes. 

However, as mentioned, taxes drive behaviour and the end result of this will be far fewer new boats sold in Canada in 2022 (tax begins after 12/31/21).  People will buy their boat in the US, leave it in the US (or elsewhere) and then bring it into Canada as a "used" boat at some point once it is worth less than whatever arbitrary amount the gov't decides to tax. 

They will get almost nothing of what they expect - similar to what happened when they increased the tax on higher income earners.  

https://www.theglobeandmail.com/politics/article-high-income-earners-paid-46-billion-less-in-taxes-in-2016-despite/

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1 hour ago, robalex117 said:

Yes of course you can but if it is perfectly legal to buy a $1million dollar toy and register it offshore

Sure you can. But you can't use it in Canada without leaving the country fairly regularly. Honestly I don't know how long non-US boats are allowed to stay.

It won't really hurt too many boat builders in Canada. We only have a few builders of >250K boats. West Bay, Kanter, Gozzard. Maybe some small east coast builders.

50 minutes ago, Monkey said:

I can already see the new business model. Here you go sir, enjoy your new 249,000 dollar yacht. I understand it’s a little basic. If you stop by next week, we’d be happy to modify it for you. Shouldn’t cost more than a few hundred thousand. 

Maybe. But if you do that too obviously, the tax people will eventually hear of it and get you under "avoidance, tax"

 

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1 hour ago, AJ Oliver said:

Are you certain that your assertion is true ?? The early 1990s were also the time during which sailing participation began to plummet, and it has continued to do so. And most of the decline was due to factors other than the tax.  Sailboat sales declined, including boats that were not subject to the tax (cost less than $ 100K). Back in the early 1990s you could buy a lot of boat for that much. 

Second point: As many of you know, the US (especially) has experienced alarming shifts upward in income and wealth - and you are advocating tax policies that will make it worse. 

I'm try to be civil here - hope I am succeeding. 

You are being civil, just, you see things differently. 1987 saw a huge recession grip the country. The luxury tax just a few years later left the wealthy yacht buyers in a position to procure yachts from other markets. The mid to large powerboat industry, which is what we are mainly discussing, due to the fact that they were about 80% of the pleasure boating market, we’re faced with no the a deep recession and a luxury tax. Both created by a government that couldn’t handle the economy properly. 

As far as advocating tax policies that would make things worse, taxing the wealthy, who in turn, create jobs in the manufacturing industry and in the recreational boat segment of tourism and travel, will give them an option as to where to apply their expendable income to stimulate growth and satisfy their desire not to bleed money  to the government like a pimp with a coke addiction.

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When we went through the luxury tax debacle here in the US I had one absolutely clueless idiot proclaim that "But we're not taxing the boat manufacturers, we're taxing the people who buy the boat!"

Absolute fucking retard. 

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34 minutes ago, Sail4beer said:

As far as advocating tax policies that would make things worse, taxing the wealthy, who in turn, create jobs in the manufacturing industry and in the recreational boat segment of tourism and travel, will give them an option as to where to apply their expendable income to stimulate growth and satisfy their desire not to bleed money  to the government like a pimp with a coke addiction.

You are writing about trickle down economics which has demonstrably never, ever worked. 

We progressives believe in bubble up economics which has many facets such as raising the minimum wage. 

If our corporate overlords cared a whit about working people they would at least fight for $ 15. 

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4 minutes ago, AJ Oliver said:

You are writing about trickle down economics which has demonstrably never, ever worked. 

We progressives believe in bubble up economics which has many facets such as raising the minimum wage. 

If our corporate overlords cared a whit about working people they would at least fight for $ 15. 

No, it isnt sbout simplistic misleading economic theories. It is about actual reality.

Frankly if "progressives" in power think the way tou just wrote, I hope to God and the Devil both they do not get their way...

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To fix this title to match the thread content in proper context, the title should read: 

“ INJUSTICE! How the rich are intelligent enough to avoid segregated luxury taxation and how the government makes everyone else pay.”

Please describe luxury and just how do you justify increased taxation on the same basic product to a consumer at a higher level of income and ability to provide economic return to the community and when does the term begin to apply to $100,000 boats today, which would put all of us “rich white guys” into quite a lurch?

 

I guess that you being a progressive will push for the minimum wage. I always work for my money and an increased minimum wage will kill off most small businesses that actually pay taxes. Of course, you know that and don’t care because it’s the “right” thing to do. Kind of weird to use the word “right” to describe the “left”. Me, I’m an American, plain American.
 

 

68E53561-B6D1-4E04-BCC7-ACB153C6884A.jpeg

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Minimum wage.  What a crock o shit.  Money has no inherent value in itself, it is an arbitrary scale.  All minimum wage hikes do is move the ruler further over to the right (or left if you prefer) and time just rebalances the economy to that slid over scale.  Morons.

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A small business might not even make enough to be profitable employing marginally skilled individuals at a government regulated pay level and then paying unemployment insurance and health insurance for those individuals. When the numbers turn the business upside down, the progressive will never see it. 

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We are already entering a period of Hyper inflation. Raising the minimum wage, increasing petroleum prices are two core reasons. People who own assets just watch their valuations rise. People who don't (renters or interest only adjustable mortgage holders) won't be able to afford to maintain their current standard of living. Progressives are just hamstringing those that they are supposed to be representing.

 

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2 hours ago, bgytr said:

Yup, the little guys were the ones who paid with their jobs in the US.  How many US boatbuilders went under then?  Almost all of em, very few survived.  So the real losers were the front line workers.  

That was one of mental and physical midget Sen. Barbara Mikulski's brilliant pet projects.  What an idiot.

But it didn't just hit the Boatbuilders, it hit their suppliers up the line.  

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19 minutes ago, silent bob said:

But it didn't just hit the Boatbuilders, it hit their suppliers up the line.  

Of course. Everyone involved in that economic chain got slammed.

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1 hour ago, Sail4beer said:

I’m going to jump big here,  AJ.

I’m going to assume that you have no children.

You assume wrong, got grandkids too !!!

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2 hours ago, Zonker said:

Sure you can. But you can't use it in Canada without leaving the country fairly regularly. Honestly I don't know how long non-US boats are allowed to stay.

It won't really hurt too many boat builders in Canada. We only have a few builders of >250K boats. West Bay, Kanter, Gozzard. Maybe some small east coast builders.

Maybe. But if you do that too obviously, the tax people will eventually hear of it and get you under "avoidance, tax"

 

In BC we have

Coastal Craft

Eagle Craft / Daigle

Lifetimer

Hurricane / Zodiac

Adrenaline

... all make boats over 250K.  Any new boat over 30 ft long will easily be over that threshold.

 

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I suppose there will be games played with selling boats sans motors, sails or electronics. I just don't see how the CRA can expect to get a lot of revenue from the few big ticket new boats and aircraft sold in Canada, when the buyers have so many different ways to structure their purchase. 

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57 minutes ago, spankoka said:

I suppose there will be games played with selling boats sans motors, sails or electronics. I just don't see how the CRA can expect to get a lot of revenue from the few big ticket new boats and aircraft sold in Canada, when the buyers have so many different ways to structure their purchase. 

Games will certainly be played.  I work for the biggest of the boat building conglomerates, and my guess is that engines will become after purchase add ons in Canada.

 

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