Mar 28, 2022

The NMMA Canada has released the following notice regarding the new luxury tax on cars, aircraft and boats. 

NMMA Canada President Sara Anghel wrote that our industry has been awaiting the release of legislation related to the luxury tax on boats over $250,000. The federal government recently posted draft legislation for comment, which you can read here (as the language is highly technical, we recommend you first read the background paper released by Finance last fall). The deadline for public input is April 11, 2022.

Based on our initial reading, the government has not made major changes from the tax proposal outlined in Budget 2021. The major pieces include:

• The tax would come into effect on September 1, 2022;

• Only deals signed before April 20, 2021 would be exempt from the luxury tax after the effective date—all other orders must be delivered to customers before September to avoid taxation;

• HST would be charged on top of the final luxury taxed amount;

• For boats above $250,000, any improvements over $5,000 made by the owner within a 12-month period would also be luxury taxed.

Last week, NMMA Canada and several marine businesses met with Finance Department officials to walk through the legislation and pose questions. We will also be meeting with Minister Freeland’s political staff in the coming days. In addition to meeting with government officials, NMMA Canada will formally respond in writing together with the regional Marine Trade Associations to ask for relief and continue to express our concerns with the negative effects the tax will have on the industry. We encourage you to flag any concerns to us directly so we can bring them to the government’s attention.

As well, if you haven’t already done so, we urge you to write your local Member of Parliament using the following Template Letter

Thanks for your continued support of NMMA Canada’s efforts on your behalf. Please do not hesitate to contact me (sanghel@nmma.org) or Jim Wielgosz (jwielgosz@nmma.org).