Import tax question

As I explore post pandemic charter boat options I still have not been able to get a answer to the question of import duties if a US flagged vessel is moved from the BVI to the USVI. I understand that the vessel is exempt in USVI waters but I am told that if the vessel overnights in any other US waters including the Spanish Virgins the import tax becomes due and payable. Others say not true. Anyone have a reference or source one way or another?

We bought a boat in the BVIs and moved it to the USVIs and sailed Puerto Rico. The issue never came up. I'd ask your accountant to research.

Cheers, RickG

Well I am my accountant and I asked myself but did not know. I might have to fire myself! A call to customs resulted in a yes the import duty would be due but he waffled. Then he started asking my name and boat name! The Moorings seems to believe the tax would be due and has not opened a USVI base as a result. Not sure if that’s the true reason as they could stock the base with non US flagged vessels.
G

As I understand it, if it is the same as bringing a boat into the US, you have a certain amount of time it can be brought in before you need to import it.

That is the kind of question no one wants to answer ( off the cuff) because 1 if they are wrong it can kill their professional business, and 2 asking means you have a significant vulnerability and you would be a client if someone could nail you down ( and you don't want to be a billable client.) We really do understand you don't want to give USCBP any reason to stop or search your vessel, nor any hint that your paperwork is Out Of Order.

I really think you need to pay up for a professional answer and quit looking under the bleachers. Just MHO. Half a million in boat bucks is not a dingy.

The problem is I have reached out to professionals and no one really has a answer. As one person told me it’s a very gray area. I suspect by the letter of the law the tax is due if a US flagged vessel enters US waters. The reality is that customs appears not to track it. If I bring my current boat to the USVI I guess I Will just pay the tax. It will make the boat easier to sell when the time comes.
G

If there is a chance to make some charter money now before < whoever> bills you for a tax burden you aren't sure you owe, would you not take the opportunity ? If customs doesn't generate the bill, who does ? Do you play cards ? Have a decent attorney ? Can keep a straight face ?

Yeah, if the import tax is paid, a sale will be easier if the buyer is from the US purchasing to use from a US port. It won't matter if the buyer is from New Zealand or Capetown SA or Corsica or France, Aruba, St. Vincent or Grenada and NOT declaring a US port as home.

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BOAT bucks. Break Out Another Thousand. It's always something.

So Stick to what you think is the reality and believe like you mention “Customs appears not to be tracking”.
A few years from now the IRS will hit you with penalties and compound interest which will probably open your eyes.
People on this forum have given you the answers previously.

I guess I missed the answer to what happens if the boat goes to the SVI. I know the boat does not have to pay the tax in the USVI.

George, I have sailed 2 different us flagged boats from BVI to SVI and have never had this issue raised when clearing in.

I don't know anything about federal import tax, but I can tell you most states will charge you a tax if you move from BVI to your state. I don't know if that applies to USVI....as it is not a state and seems to have some sort of duty free zone status. We purchased our boats abroad and imported directly to BVI. No tax. But, as soon as we registered with the USCG, our state (CA) came knocking with their hand out. As we did not bring the boat to CA, no tax due, although you have to jump through the hoops to prove it is not located in CA.