Australia Readies Marine Industry Tax Boost

by Mary Swire, Tax-News.com, Hong Kong

17 May 2011

The Australian government is to amend goods and services tax (GST) legislation to help Australian recreational boat builders compete with international manufacturers.

The GST law will be amended to allow boats used for recreational purposes to be sold in Australia GST-free if the boat is exported by the purchaser within 12 months and only used for recreational purposes whilst in Australia. Currently the law requires that boats be exported within 60 days.

"These changes will allow Australian boat builders to overcome disadvantages they face relative to foreign competitors, who can more easily sell boats for export tax free," the former Assistant Treasurer, Nick Sherry said when announcing the measure last year. He went on to added that:

"This change will make the purchase of an Australian-made boat more attractive to overseas buyers. Buyers will be able to sail new Australian-made boats in our waters for up to twelve months without paying GST on the sale price, resulting in economic benefits for Australia's coastal regions."

"It should provide an economic boost for boat builders in regional areas and overseas buyers sailing in Australian waters will also contribute to greater activity in regional ports."

The measure will take effect from July 1, 2011, providing the measure is unanimously agreed upon by provincial governments. A public consultation is to be held before the measure's adoption.

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