Superyacht industry says tax break could mean $1.4b boost
A FEDERAL Government tax break for superyachts may well be on the horizon, with a swell of support for new legislation currently under the spotlight and stakeholders hoping for a change in GST fees.
According to Superyacht Australia's economic impact statement, the annual $1.9billion industry could be boosted to a possible $3.3billion a year within three years.
Mary Anne Edwards, current director and former CEO with Superyacht Australia, the national umbrella body for all the cluster groups, said the GST issue was seen as one of the biggest barriers to growth in the industry and she was waiting to hear "in the next few weeks” when it would be raised again in parliament.
"We're pushing for sooner rather than later,” MsEdwards said.
She said if legislative amendments were made, more superyachts would be attracted to Australia and the Whitsundays would be the biggest beneficiary.
"That's where most of the boats come in and stock up and then they go south down the coast from there.”
She said there were about 13 superyachts berthed in Fiji right now and "at the moment they're not coming our way” because of the GST tax.
The industry believes the current 10per cent GST charge encourages these large boats to bypass Australia in favour of cheaper jurisdictions like New Zealand, Fiji and Tahiti.
Superyachts - identified in Australia as a vessel with a master and crew carrying 12guests or fewer, no cargo, and greater than or equal to 24m in length - under a controlled permit can stay for a maximum of three years, but they must pay GST to fully import the vessel if they wish to charter for a few weeks rather than a GST on the charter value, as is the case in other countries including New Zealand.
"It's about asking the government to allow the vessels to charter here on a temporary basis so while they're here they can provide a charter or two.
"This then helps cover some of the huge costs of bringing the vessel here, generally from the Med or Caribbean. Then, if they are able to do this, they're far more likely to come and to spend longer in Australia,” Ms Edwards said.
"So currently, if they wish to do a two-week charter while here, a $40million superyacht would have to pay $4million in GST, but you can go to New Zealand and pay a 15per cent GST on the charter value.
"If it's $250,000 a week for a charter in New Zealand, they pay $37,500 in tax which the government gets. At the moment the Australian Government is getting nothing because the superyachts are not even coming in.”
Other flow-on economic benefits for a local region, Ms Edwards said, included maintenance and refit costs spent locally where the yachts were berthed.
Ms Edwards said coastal trading amendments would allow superyachts to operate as charter boats on a temporary permit when in Australian waters, therefore encouraging more superyachts.
"This legislation will create new jobs for Australia and in the Whitsundays the knock-on is huge.
"They will come in and buy local and the guests will spend money and participate in local events. They spend about $7500 a day per guest. People don't believe it, but it is a reality.
"On top of this, the vessel will spend up to $5000 a week on flowers, and then guests will go touring in the local region, taking in the region's signature experiences.
"The supply chain required to service the needs of these vessels is huge, from fuel, food, wine, meat and obscure things - they might need cushions replaced on the boat or clothing for crew. Anything you can think of, they're going to need.
"Whereas on a cruise ship, because everything is included, the spend per guest is much less.”
Ms Edwards said a change in legislation would increase revenue streams and jobs in an area that had been "decimated” after Cyclone Debbie.