National Association of Charterboat Owners President Bob Zales II, provided testimony Mar. 4th, 2009 before the Florida House Finance and Tax Council to object to taxing our charter trips. We have pasted below the testimony that will be given.
Please contact your local state representatives and object to any sales tax on our charter trips.
Keeping You Informed
National Association of Charterboat Operators
BOB ZALES, II
FLORIDA HOUSE OF REPRESENTATIVES
FINANCE AND TAX COUNCIL
ON BEHALF OF THE
PANAMA CITY BOATMEN ASSOCIATION
FLORIDA GUIDES ASSOCIATION
NATIONAL ASSOCIATION OF CHARTERBOAT OPERATORS
MARCH 4, 2009
Madam Chairwoman and Council Members, the Panama City Boatmen Association, Florida Guides Association, and National Association of Charterboat Operators appreciate the opportunity to testify regarding Exemption Number 128, Charter Boat Fishing, updated for 2009-10. Our membership includes charter boat, guide boat and party boat owners, operators, crew members, and supporting businesses from both coasts of Florida and across the Nation. My family has owned and operated charter boats for 43 years in Panama City. These small family businesses help to produce the saltwater recreational fishing impact of $7.6 BILLION in sales and 131,000 JOBS (NMFS Fisheries Economics of the United States, 2006). Due to the increasing crisis of the regulatory and economic conditions these monies and jobs are expected to decline.
Florida requires all saltwater charter boat owners to obtain a state license to operate a recreational charter boat, guide boat, or party boat. There are 3 categories of license.
Florida Recreational Saltwater For-Hire Fishing Licenses 2007-08
Florida Fish and Wildlife Conservation Commission
There were 3,573 saltwater charter boat for-hire fishing licenses sold for 2007-08. Sixty-four percent (64%) are for vessels that carry 4 or less people. State wide, these vessels typically average 2 people per trip. According to Ms. Sails, with the Florida Wildlife Research Institute (per com) there are less than 100 party boats (3% of total licenses) operating in Florida. According to several party boat owners, in the past year the average number of passengers per trip has been 25 to 30. There were 1198 (33%) licenses sold for 10 or 6 persons or less which includes 89, 11 persons or more licenses. These charter boat licensed vessels typically average 5 passengers per trip.
These numbers are dramatically different than those provided to you by the Florida Department of Revenue as updated for 2009-10. Those figures indicate there are 5823 registrants for 2008-09 and of those 1019 are party boats and 4804 are charter fishing boats. The report indicates that the average number of passengers for party boats is 40 and 6 for charter boats. Clearly, the total number of licenses issued is 3573 of which 64% (2275) carry 4 people or less. It is impracticable to assume for all charterboats that the average number of passengers per trip would be 6. The projected sales tax of $23.7 million from charter boats is not even close to reality. Remember, the same projection from the 2008 Florida Tax Handbook (page 125, item #188) indicated a $71.3 million impact from charter boat fishing. It is extremely difficult for our industry to have any confidence in these projections.
I have one final statement. As stated above, recreational saltwater fishing in Florida accounted for $7.6 BILLION in sales and 131,000 jobs for the state. A significant amount of this impact was due to people coming to Florida to fish in the Sport Fishing Capitol of the World. These people traveled to Florida buying gas, staying in hotels, eating in restaurants, buying supplies, buying food, paying for other forms of entertainment, all of which collect taxes for the state and local communities. The charter boat owners buy fishing tackle and supplies, bait, ice, fuel, use local dry docks, hire mechanics, purchase state and federal licenses, buy electronics, employ vessel crews, all of which contribute to the state tax base. Federal and state regulatory actions over the past two years have reduced fishing seasons, bag limits, and access to traditional fishing grounds. High fuel costs have been absorbed by the vessel owners. An ever slowing economy has drastically reduced the number of fishing trips.
Please consider this. A sales tax on charter boat fishing will be an additional cost to an already floundering industry and will likely be the final blow to us. The vast majority of charter boat owners are on the brink of shutting down their operations. Without a charter fishing fleet in Florida, those people who have historically come here to fish and bring their families, friends, and employees to enjoy this form of recreation will find other destinations. Unlike other service providers that provide necessary items, recreational fishing is not necessary. It is a discretionary expense that people do not have to do.
Your decision is a difficult one. Please consider the overall impact and the cost to our State if we lose a significant number of jobs and revenue associated with our industry. The revenue the State receives now is far greater than the tax that could be collected. The State Revenue Department has not provided you with a projection of the amount of revenue to the state that will be lost by the increased burden placed on us, by those who will go out of business, and by the total loss of business in other sectors of the state business community. We suggest when you consider all of the impacts, that the net economic benefit of imposing a sales tax on the charter boat sector will be a negative to the state. Most importantly, it will drive small family operations out of business and they will be forced to seek state assistance which we cannot afford.
Keeping you informed,
National Association of Charterboat Operators