Is Sales Tax Due in Puerto Rico on a USCG doc. vessel?

[joshrosenthal1]

Im looking at purchasing a vessel that is located in Puerto R. it is USCG documented.

Can anyone tell me if the sale will have a sales tax due in Puerto Rico?

[pesarsten]

It will depend on where you will be basing the boat. You should not be required to pay PR sales tax if you will be moving the boat after purchase. Many states require state registration of the boat if kept in the state for more than 30 days. That's where you will be required to show proof of tax paid or required to pay the tax when registering.

[BandB]

Originally Posted by joshrosenthal1

Im looking at purchasing a vessel that is located in Puerto R. it is USCG documented.

Can anyone tell me if the sale will have a sales tax due in Puerto Rico?

Use a documentation service knowledgeable of Puerto Rico's laws. Their taxes have been changing regularly for the last few years. Sales tax has been replaced by VAT but items subject to excise tax are separate and appear to include vehicles and boats. Still there are exemptions and more issues than can just be casually addressed online.

The things you will need to know is what taxes have previously been paid there on the boat, was the boat registered in PR, how long has it been there, how long will you keep it there, where are you taking it and will you be registering it and paying sales tax there. You need to use an expert to avoid issues and surprise costs.

[hellosailor]

Documentation status has nothing to do with sales taxes. Federal documentation is about title. Sales tax (or use tax or excise tax) is applied by a state. The state where the sale takes place, the state where the boat will be located, the state where the buyer resides. All three will have different rules and you'd need to check them out for your situation.

You could write to each state (PR is in insular possession, but let's ignore that) and ask their rules for your situation. Or, I understand there's this newfangled thing called the World Wide Web and most of those state tax departments have all their rules posted on that.

[BandB]

Originally Posted by hellosailor

You could write to each state (PR is in insular possession, but let's ignore that) and ask their rules for your situation. .

But his question is specifically about PR, so ignoring it seems a bit crazy. And, yes, you can find most states information on the web, but I was unable to find any definitive information on the web that answers his PR question. Even if I could today, there are too many issues and questions and it's always changing so I'd recommend a documentation company. I know Marine Title is big on PR.

[hellosailor]

BandB-
RTFM. I didn't say to ignore Puerto Rico, I said to ignore the fact that it is an insular possession rather than a State. You can't find a State Tax Authority or "State Police" or "State" anything in PR, but you will find equivalents.

[BandB]

Originally Posted by hellosailor

BandB-
RTFM. I didn't say to ignore Puerto Rico, I said to ignore the fact that it is an insular possession rather than a State. You can't find a State Tax Authority or "State Police" or "State" anything in PR, but you will find equivalents.

Well, you can't ignore it's not a state. It isn't. Not a sales tax, now a VAT. Excise tax. So talking about writing to each state has no meaning on PR. I'll stick to my recommendation.

[joshrosenthal1]

Thanks a lot folks / lots of Good starting info. The boat has been in PR for about 4-5 months. Came from BVI. It is USCG documented vessel. The sale will occur in PR. I'm a Californian resident BUT thinking of registering the boat outside the USA. Not sure. I do know that if I bring her to CA There is a way to avoid exuberant CA tax.

[gts1544]

joshrosenthal1, We have a USCG documented 41' Beneteau that we have been "temporarily importing" into the BVI's for 20 years now by paying an annual $200 temporary importation tax. Additionally, by being a "BVI resident boat", we pay the resident rate on the National Parks Trust decal & permit, thus saving us $75, enabling the use of primo diving location mooring balls, plus no need for expensive BVI cruising permits. George

[gts1544]

joshrosenthal1, If the boat came from the BVI, it may have already been legally imported into the BVI and no additional taxes would be owed. Ditto, PR!
Another delightful location would be Ensenada Honda on Culebra, PR, an island just 20 miles east of Fajardo, PR with excellent inexpensive auto & personell ferry service. Fajardo has a Super WalMart and a West Marine with shuttle servive to the ferry terminal.
Salinas, PR is a well known cruiser's hang out on the SE coast of PR. Very nice!
George

[rajsach]

Hi Josh,
I live in Puerto Rico now. I just bought a new leopard 44 catamaran last year. It was purchased in Miami and brought here. I had to pay the max import tax of $10k. It is a USCG documented vessel but it didn't matter. Unless you are willing to jump through ALOT of hoops just expect to pay through your nose. Bottom line is they need revenue right now and are going to tax you every way they can. Just factor it in to the price and if you can skirt it it's "lagniappe " as we say back home in Louisiana . I have found that the laws here are very different than what I'm used to state side. Bottom line just consider it all as a transaction cost and it will work out in the end. Good luck.

[Gerrit Coetzee]

Originally Posted by joshrosenthal1

Im looking at purchasing a vessel that is located in Puerto R. it is USCG documented.

Can anyone tell me if the sale will have a sales tax due in Puerto Rico?

Did you end up paying PR taxes?

[the Aviator]

Originally Posted by rajsach

Hi Josh,
I live in Puerto Rico now. I just bought a new leopard 44 catamaran last year. It was purchased in Miami and brought here. I had to pay the max import tax of $10k. It is a USCG documented vessel but it didn't matter. Unless you are willing to jump through ALOT of hoops just expect to pay through your nose. Bottom line is they need revenue right now and are going to tax you every way they can. Just factor it in to the price and if you can skirt it it's "lagniappe " as we say back home in Louisiana . I have found that the laws here are very different than what I'm used to state side. Bottom line just consider it all as a transaction cost and it will work out in the end. Good luck.

question the $10k you paid in tax was a percentage against purchase price?

I bough a sailboat in Jax and will be bring in it to PR

[robywire]

No taxes if you are a non-resident of PR and you leave within 60 days. You may be able to get permission to extend the 60 days to get work done, etc.

P.R. Laws tit. 13
Subtitle 17 Internal Revenue Code of 2011
PART IV. Excise Taxes
Chapter 1032. Taxes on Goods
• § 31629. Vessels and heavy equipment
• (f) Exemption on nonresident ships.—
• (1) Ships with foreign registration or documented by the United States Coast Guard shall be exempt from the excise tax provided by this section if they are acquired by a Puerto Rico nonresident, who has the title and ownership of said ship, and who does not engage in the sale of ships in Puerto Rico.
https://casetext.com/statute/laws-of...taxes-on-goods

PART V. Sales and Use Tax
• Chapter 1043. Exemptions (§§ 32051 — 32071)
• § 32051. Exemptions.—Powers of the Secretary
• § 32052. Certificate of exemption and certificate of eligible reseller
• § 32053. Exemptions for export
• (a) Except for the reciprocity requirement concerning the collection of sales and use taxes in Puerto Rico provided in this part, the taxable items sold for use or consumption outside Puerto Rico shall be exempt from the payment of the sale and use tax established in this Subtitle, even when the sale takes place in Puerto Rico. In order for the taxable items thus sold to be exempt from the taxation, they must be exported within sixty (60) days as of the date of sale.
• (c) Subject to the provisions of §§ 33001 et seq. of this title, the Secretary may extend the time limit established in subsection (a) of this section for a taxpayer to export taxable items.
https://casetext.com/statute/laws-of...es-and-use-tax