Towards a tax on high-end pleasure boats
Canadian media have reported on a government plan to introduce a tax on a number of so-called luxury goods, including some boats, but also cars and planes. Boaters who own a boat costing more than 250,000 Canadian dollars, or about 165,000 euros, would be subject to this tax as of January 1, 2022. The amount collected by the Canadian government would be calculated on the basis of the lower of :
- 20% of the sales price above the tax limit (C$100,000 for cars and airplanes and C$250,000 for boats)
- 10% of the total value of the property.
According to the CTV News website, the official document it consulted estimates the gain for the federal government at 604 million Canadian dollars over 5 years, or nearly 400 million euros. The project still needs to be approved
Canadian boating industry concerned about funding
The proceeds from this tax are intended to rebalance some of the effects of the Covid-19 pandemic. "While Canadians have made sacrifices to keep the economy moving during the pandemic, some of the wealthiest have fared well. Those who can afford luxuries can afford to pay a little more," the document quoted by the Canadian site said.
The fear of this 10% tax already mentioned in 2020 had led the National Marine Manufacturers Association (NMMA) Canada to react, referring to the failure of such schemes in the United States, Italy, New Zealand and Norway in the past. "We simply cannot support a new tax that would severely damage the marine industry, putting thousands of jobs at risk and potentially putting the government's finances even further in the red," said NMMA President Sara Anghel.
While reports are accumulating on the widening of inequalities during the pandemic, the idea could nevertheless seduce other countries. If the purchase of a pleasure boat today appeals to the wealthy segments of the population with restricted travel habits, the emergence of this type of initiative could be a brake to be taken into account in the market's evolution forecasts.
