Vessel Excise Tax Cap Offers Financial Incentive to Title Big Boats in Maryland
Great news for Chesapeake Bay boaters: The Maryland General Assembly this year passed legislation capping the five percent vessel excise tax at $15,000. The new law ─ which offers a financial incentive for boaters to trade-up, or register an out-of-state vessel in Maryland ─ was signed by Governor Martin O’Malley, effective July 1, 2013.
“Our hope is that residents from Virginia, DC, New Jersey ─ anyone looking to take advantage of the best the Chesapeake Bay has to offer ─ will dock their boat in Maryland to allow for an easy Bay getaway,” said Mark O’Malley, DNR director of Boating Services. “Whether you’re after excellent fishing, recreation or world-renowned seafood, our great State is an amazing place to live, visit, work or play!”
Previously, boaters paid a five percent uncapped tax on the purchase price or fair market value of a vessel with *principal operation in Maryland. The new law affects boats valued at $300,000, either newly purchased or relocated here.
Boaters who select Maryland as their primary home port will receive full credit for vessel taxes paid to the State where their boat was previously registered. Those trading up will pay tax only on the difference between the purchase price of the new boat and the trade-in value.
Vessel excise tax revenue goes to the Waterway Improvement Fund, created in 1966 to support the development, use and enjoyment of all waters of the State of Maryland for the benefit of the general boating public. The fund provides financial support to local governments, the Maryland Department of Natural Resources, and federal agencies in the form of grants and/or loans for a wide variety of capital projects and services for the boating public.
Click here for more information on how to register and title a vessel in Maryland.
*State of principal operation means the State in whose waters a vessel is or will be operated most during a calendar year.