HB0451 Luxury Tax Update-Debrief

My Observations:

I just got back in town after a long day that started at 4:30 am. After a long drive down I-55 in pea soup fog and mist which turned into rain, I arrived at the State Capitol Building at about 9:45am.

I'd been to a city council session as part of my citizenship merit badge many moons ago, but never to a legislative session for our state. It was an interesting civics lesson for me. What I learned is that it is very important for each of us as taxpayers to be aware of what our lawmakers are proposing. We shouldn't just leave it up to special interest groups and lobbyists because their interests aren't always best for us. It takes everyone getting involved at some level to communicate dissaproval of legislation. Simply complaining after the fact, does no good to the process.

The legislators task is a difficult one, they are approached from many different angles by many different people. Ultimately it is their judgement and hopefully common sense that rings true and has them do the right thing in the best interest of the majority. In the electronic age we live in, information travels at a very fast pace. Transparency is there through the freedom of information act, but we need to know how to find it.

This story had a happy ending for now- but it is one that given the current state of our local and national budgets, may surface again. If it hadn't been for the NMMA newsletter, I may have missed it myself. Most importantly, I learned that the letter that we don't want to send can make a difference. I wrote to the sponsoring representative and presented my case as a business owner. When I spoke with him after the session, he commented on reading it and seeing my position on the bill (and understanding). I shudder to think what could happen (or happens) when people think- "Oh it won't make a difference" or "What can I do about it?".

YOU can make a difference! But It takes all of us speaking up.

Enclosed is the official press release from NMMA. Thank you to Dave Dickerson and Mark Adams for your support and guidance through this.

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FROM: NATIONAL MARINE MANUFACTURERS ASSOCIATION
444 North Capitol Street NW
Suite 645
Washington, DC 20001
202-737-9750
FOR IMMEDIATE RELEASE

CONTACT: Christine Pomorski (cpomorski@nmma.org; 202-737-9774)

Proposed Illinois Luxury Tax on Boats Withdrawn From Consideration

Boating organizations, including NMMA, were prepared to testify

WASHINGTON, DC, February 26, 2009 – Today, the Illinois State Legislature’s Revenue and Finance Committee decided not to move forward with HB 451, a bill to impose a five percent luxury tax on vessels sold in Illinois over a purchase price of $200,000. Mark Adams, vice president of sportshows for the National Marine Manufacturers Association (NMMA), along with opponents from six different marine-related organizations and businesses, attended the hearing to testify in opposition to the tax. However, before testimonies could be heard, the committee echoed industry concerns about the tax and withheld a motion to take up the legislation.

The proposed tax would have had a devastating effect on Illinois’ marine businesses, causing buyers to hold off on buying boats or cross state lines to make purchases. In the early 1990s, a similar national luxury tax on boats was enacted, only to be repealed two years later because the tax cost more to collect than the revenue it earned. The tax also led to 19,000 lay offs, cut boat sales by 40 percent, pushed tax revenue from boat sales to below pre-luxury tax levels and forced several brands of boats into bankruptcy.

“While we understand Illinois must address its looming budget deficit, we are pleased the committee realizes a counter-productive tax like this one is not the answer,” said David Dickerson, National Marine Manufacturers Association director of state government relations. “Despite assurances from the bill sponsor that similar measures will not be pursued, we will continue to monitor any new legislation moving forward,” Dickerson said.

National Marine Manufacturers Association (NMMA) is the leading association representing the recreational boating industry. NMMA member companies produce more than 80 percent of the boats, engines, trailers, accessories and gear used by boaters in the United States. The association is dedicated to industry growth through programs in public policy, market research and data, product quality assurance and marketing communications.
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