$18,000 sales tax cap now law in Florida

[Bugsy]

I own a foreign flagged vessel that is here on a U.S. Customs and Border Protection Cruising Permit. Because it was built in the United States I do not have to leave the country at all. Once a year I just go to the Customs & Border Protection office and pick up a new annual cruising permit for free.

.

You probably shouldn't publish your good fortune. Any chance you could PM me with your location?
I'm Canadian; NOT a legal US resident nor in the diplomatic corps and my boat is Canadian flagged.
There is no question----proper enforcement of US regulations would require that for renewal of a Cruising License, you must leave US waters. You cannot have successive licenses.

However----a few years ago, I got a successive license without going to the Bahamas. The next time, I went to Miami and they refused. I wrote to Washington for an administrative ruling and got the official reply; "No successive licenses".

The fellow I spoke to in Ft. Myers recently told me that they were all aware that some regions have different "practices" and sometimes it's "luck of the draw" but really there is no ambiguity----unless you fall within one of the limited enumerated classes, you have to leave US waters and request issuance of a new license.

[ThirdHatt]

[QUOTE=Bugsy;161543]You probably shouldn't publish your good fortune. Any chance you could PM me with your location?
I'm Canadian; NOT a legal US resident nor in the diplomatic corps and my boat is Canadian flagged.
There is no question----proper enforcement of US regulations would require that for renewal of a Cruising License, you must leave US waters. You cannot have successive licenses.
QUOTE]


Sorry Bugsy but this is not what you call "good fortune", it is just me following the law and doing EXACTLY as I am instructed by the U.S. Customs and Border Protection Agency. I have gotten successive licences from more than one jusristiction over the years and they have always told me the same thing: DO NOT LET IT EXPIRE! As long as I get a new license on the date (or as close to the date as possible without letting it pass) then there is no problem.

Do I sense some hostility because you see this as my "good fortune" just because you were denied? What do you need with my location? I am cruising so my location changes, as does my cruising permit. My current location is completely irrelevant.

You said it above, it is because you are NOT a U.S. Citizen that they will not allow you the same privelege. There is no reason for you to be upset with me for the example that I posted to hopefully help someone in a similar situation. I am a U.S. Citizen and the rules are different for non-U.S. residents.

[yachtbrokerguy]

I have heard of different interpetations of the regulations by different Customs districts, but here in Florida, if the the vessel with a cruising permit was BUILT IN THE US, it does not have to leave to renew. So a Hatteras can renew locally but a Jefferson has to leave to renew.
I will say once again that a non US citizen can own a Florida corporation and that corporation can own a boat. FL numbers must be marked on the bow like smaller boats and the boat can carry an American flag. It can not be documented with the USCG, but can only be registered with the state. US Customs allows the US flag but requires the vessel to enter and clear like a foreign owned vessel when coming and going from a foreign port.
Tucker Fallon

[ThirdHatt]

I have heard of different interpetations of the regulations by different Customs districts, but here in Florida, if the the vessel with a cruising permit was BUILT IN THE US, it does not have to leave to renew. So a Hatteras can renew locally but a Jefferson has to leave to renew.

Tucker Fallon

Thanks for clearing that up Tucker. My experiences and past cruising permits from your state (and other state's juristictions that will remail nameless, lol) confirm that what I and many other U.S. Citizens have known for years.

[Bugsy]

ThirdHatt...

I don't know you from Adam. However, I think it a reasonable guess that I harbour no envy nor am I "upset" that you apparently have access to "benefits" that are not available to non-US residents.

I appreciate that you cannot see the lump in my cheek when I write of your "good fortune". However, you might pause occasionally to ensure that a poster's anatomical parts are all in their intended position.

I have two boats both of which were manufactured in the US and both of which are or have been the subject of a "cruising permit". I am a proud Canadian.

A "flagged" vessel is by definition, a "registered" or "documented" vessel.
A "foreign-flagged vessel" is...you've got it!!---NOT a US documented vessel.

You cannot document a vessel in the US unless you are a US citizen. If you are "foreign" and purchase a US documented vessel, the documentation must be cancelled. I am sure you know all of that.

It is however possible that you (et al) were NOT aware of the following extracted from the CBP website:



CRUISING LICENSES. Cruising licenses exempt pleasure boats of certain countries from having to undergo formal entry and clearance procedures such as filing manifests and obtaining permits to proceed as well as from the payment of tonnage tax and entry and clearance fees at all but the first port of entry. These licenses can be obtained from the U.S. Customs port director at the first port of arrival in the United States. Normally valid for one year, a cruising license has no bearing on the dutiability of a pleasure boat.

NOTE: Under Customs policy, when a foreign flag vessel's cruising license expires, that vessel may not be issued another license until the following three conditions have been met: (1) the vessel leaves the United States for a foreign port or place, and (2) it returns from that foreign port or place, and (3) at least 15 days have elapsed since the previous license expired. (Customs Directive 3100-06, November 7, 1988.)

Vessels of the following countries are eligible for cruising licenses (these countries extend the same privileges to American pleasure boats):
Argentina Greece
Australia Honduras
Austria Ireland
Bahama Islands Italy
Belgium Jamaica
Bermuda Liberia
Canada Marshall Islands
Denmark Netherlands
Federal Republic New Zealand
of Germany Norway
Finland Sweden
France Switzerland
Turkey
Great Britain (including Turks and Caicos Islands, St Vincent [including the territorial waters of the Northern Grenadine Islands], the Cayman Islands, the British Virgin Islands and the St. Christopher- Nevis-Anguilla Islands).

Note that this list is subject to change.



USER FEES. U.S. pleasure craft and foreign-flag vessels without a cruising license that are 30 feet or longer in length must pay an annual fee of $25 for the user fee decal. Contact your local customs office if you have any questions on this subject.

IMMIGRATION REQUIREMENTS. Every person entering the United States must be seen in person by an immigration officer, except those participating in the Canadian Border Small Boat Program. Information about this program may be obtained from any immigration office.

U.S. citizens should carry proof of citizenship such as a passport or birth certificate. (Voter registration cards are no longer valid for this purpose.) Canadian citizens should present proof of Canadian citizenship; Mexican citizens may present a border-crossing card. Canadian, Mexican, and U.S. citizens must carry a passport if they are arriving in the U.S. from outside the Western Hemisphere.

Legal permanent resident aliens must present Immigration and Naturalization Service form I-551. Nonresident aliens other than Canadians and Mexicans must present a valid passport and visa.


TEMPORARY AND PERMANENT IMPORTATIONS

PERSONAL EXEMPTIONS

RETURNING U.S. RESIDENTS. Customs determines if a person who formerly resided in the United States is a returning resident by considering whether, when the person departed, he or she intended to leave the United States permanently. In making this determination, Customs may consider the duration and purpose of the person’s foreign stay and if, while abroad, the person maintained a home in the U.S.

A United States resident living or stationed abroad and entering the country for a short visit may import a foreign-built boat duty-free if, upon arrival, he or she claims and is given nonresident Customs status and exports the boat when leaving the United States. United States citizens employed abroad and government employees returning on TDY or leave may also be granted this status.

Permanent Importations
A returning U.S. resident who is importing a boat (i.e., bringing it in permanently, as opposed to temporarily) will be required to pay duty on that boat. The personal customs exemption toward duty owed on a foreign-built pleasure boat may be applied under the following conditions:

The boat is imported for his or her personal use or for use by members of that household.
The boat was acquired abroad as an incident of the journey from which he or she is returning.
The boat accompanies him or her at the time of return.

The head of a family returning together may make a joint declaration for all members residing in the same household and pool their customs exemption toward the duty on an imported boat.

RATES OF DUTY. Pleasure boats are generally dutiable when imported into the United States.# The following duty rates apply to boats imported for recreational purposes:

Sailboats and motorboats other than outboard motorboats........1.5 percent
Outboard motorboats........................................ ..........................1.0 percent
Inflatable vessels........................................... .............................2.4 percent
Canoes............................................ ...........................................Free of duty
Rowboats not designed for use with motors or sails..................2.7 percent

These rates are subject to change; call your local Customs port of entry to get the correct rates at the time of your trip. Duty rates for importations from Column 2 countries, as defined in the Harmonized Tariff Schedule, are considerably higher than those listed above.

If you are importing a yacht or other pleasure boat purchased abroad, please contact your nearest port of entry before you import the boat to learn more about entry requirements and the specific duty rate for your vessel.

NONRESIDENTS. A nonresident for Customs purposes is a foreign visitor to the United States, a person emigrating to the United States, or a person who left the United States with no intent to reestablish residency.

Nonresidents may bring vessels into the United States for their own use without having to make formal consumption entry or pay duty on the vessel.# # Informal entry at the first port of arrival must still be made, however. If a pleasure boat that was admitted duty free is sold within one year of its importation without paying the applicable duty, the vessel or its value, which will be recovered from the importer, will be subject to forfeiture. #

TEMPORARY STAYS/IMPORTATION UNDER BOND. Boats entered for the following purposes may be entered without payment of duty as temporary importations under bond:

Alterations or repairs,
As samples for taking orders,
For experimental testing,
For review, or study purposes,
For use by illustrators and photographers solely as models in their own establishments,
As professional equipment and tools of trade.

The length of stay in these circumstances is normally one year and may not exceed three years. There may be additional specific requirements for each of these exemptions from duty.
A pleasure boat and its usual equipment may be entered duty-free by a nonresident for a temporary stay to take part in races or other contests. If the contests are for other than money purses and the Customs officer is satisfied as to the importer’s good faith, the boat may be admitted without formal consumption entry or bond for stays of up to 90 days. A certificate identifying the boat will be issued to the importer and must be delivered with the vessel to the Customs office at the point of departure from the country.

If the boat remains in the U.S. for longer than 90 days, the importer will be required to post a bond. (If the importer knows that the boat will be in the U.S. for longer than 90 days at the time of entry, the bond should be posted when the initial arrival takes place.) If the boat is in the U.S. for more than 90 days, and a bond has not been obtained to satisfy the conditions of a Temporary Importation Under Bond (TIB) the boat will be subject to forfeiture.

Bond is taken in an amount equal to twice the estimated duty. Cash may be deposited in lieu of surety on the bond. The bond (or cash) will be refunded if the boat is exported under Customs supervision within the time limit required by the TIB.


With all due respect to Tucker and to yourself:

1.I have read the information circulated by the Florida Yacht Council which quotes from a CBP letter in 1999 stating to the effect that successive cruising licenses are available to a foreign-flagged vessel which was built in the US. That is contrary to the Administrative Ruling that I received in 2005. I can post the letter I received if there is any continuing interest in the subject.

2. Cruising licenses are for "foreign-flagged" vessels. If you own and operate a US documented vessel, you must be a US citizen and you are not "foreign-flagged". Ipso facto, you don't require a "cruising license".
"Tucker" notes that a non-resident may control a US corporation and register the vessel in Florida but acknowledges that although a US incorporated company is a de jure citizen and may own the boat , it can not be federally documented unless the President and Board chair of the corporation are US citizens and the company must be "controlled" by US citizens. Note: What if you are a dual citizen--for eg; Canadian/US? You acquire a boat in the US and use your Canadian citizenship to "flag" the vessel in Canada and then obtain a cruising permit and keep the boat in the US all for the purpose of minimizing or avoiding tax? Hmmmm! Nope---that would be illegal.

3. There may be reasons that a non-resident might want to own the boat within a corporation but it is not necessary for a non-resident to incorporate in order to acquire and register a boat in Florida.

4. A US citizen who is a Florida resident (for eg) can in fact both document and state register his/her vessel---and many do.

ThirdHatt...You said:

Do I sense some hostility because you see this as my "good fortune" just because you were denied? What do you need with my location? I am cruising so my location changes, as does my cruising permit. My current location is completely irrelevant.

You said it above, it is because you are NOT a U.S. Citizen that they will not allow you the same privelege. There is no reason for you to be upset with me for the example that I posted to hopefully help someone in a similar situation. I am a U.S. Citizen and the rules are different for non-U.S. residents..

As I understand the above, you are telling "me" that:

1. You are a US citizen and resident in the US.

2. You own a foreign-flagged vessel.

3. You have a current cruising license (or permit).

Okay!

Enjoy your perambulations.

[ThirdHatt]

As I understand the above, you are telling "me" that:

1. You are a US citizen and resident in the US.

2. You own a foreign-flagged vessel.

3. You have a current cruising license (or permit).

Okay!

LOL, I hope all that made you feel better about being denied! I never said that my foreign flagged vessel was registered my personal name. HMMMMMMMM.......

By the way, you never answered my question as to why you asked me to PM you my location?

The fact remains that myself (and countless others) have successfully done what you have not been able to. Cut and paste until your heart is content my friend, but it cannot change reality.

You should not be upset with me, but with the government agency that you have the problem with. I have done nothing but precisely what I have been told to do by several juristictions of U.S. Customs & Border Patrol. With all due respect, I will continue to listen to them as opposed to a Canadian citizen.

One thing that you should realize is that your 2005 ruling was under a very different government. Our new President is quite fond of non-U.S. residents so who knows, you just might be surprised at the result of a similar request five years later in 2010.

Please understand that I represent just one boat that has been issued successive cruising permits. Mr. Tucker Fallon above has been a well respected Yacht Broker in Florida for many, many years and has experienced the same thing that I have. We are merely telling you that it has and continues to work for many here in the U.S. Your mileage may vary!

[yachtbrokerguy]

So after readings Bugsy's post about all of the regulations for foreign flag vessels getting a cruising permit, the new sales tax cap in Florida looks even better for boat buyers who want to legally pay less.
When the bill was first proposed the tax cap was set at $25,000, but was reduced to $18,000, so that it was closer to the cost of forming a foreign corporation and flagging a vessel in some country such as the British Virgin Islands, Cayman or the Marshall Islands.
Some US resident boat owners that now have foreign flag registered boats might even consider paying the $18,000 to Florida to eliminate all of this concern. For a Hatteras owner there is no import duty with a "returned US goods" declaration, so the only extra fee is to a customs broker for the re-importation. For a boat built outside of the US, there is a 1.5% import duty, but that duty amount is based on the current market value and might be reduced by the value of US made components such as engines and generators etc.
Tucker Fallon

[Walter P]

I have also heard that if a vessel has been foreign flagged, even if it was built in the U.S. it is not eligible under the Jones Act to engage in commercial operations in the U.S. Years ago I attempted to buy a 58 YF that left the Hatteras plant and was sent to Saudi Arabia to the purchaser. Somehow it resurfaced down south (Mobile, Ala) where I looked at it and considered it until I was told of this regulation. Although I had no plans of using it for any commercial application, I was worried that resale down the road could be a problem. This may not be the case today as my experience happened over 25 years ago.

Walt