Paddleboards, the long, narrow buoyant boards used to paddle across water, may now be exempt from sales and use tax in Rhode Island, according to the Division of Taxation’s latest newsletter.
While Rhode Island already exempted boats and vessels from the state’s 7 percent sales tax, the general understanding was that an item could only be exempt if it had a hull identification number, as required by the U.S. Coast Guard. Under that understanding, sales tax has been applied to paddleboards sold in Rhode Island.
However, the Division has reversed course under a new interpretation finding paddleboards to be exempt. The Division notes that the Coast Guard considers stand-up paddleboards to be “vessels” when used “beyond the narrow limits of a swimming, surfing, or bathing area,” such as when used to travel long distances or for going from one point to another.
In Seattle, one entrant into the Downtown Seattle Creative Commute Contest carries her board 5 blocks to the dock, straps her lunch and work clothes aboard, and paddles to work. Likewise, a stand-up paddleboard commuter crosses the Willamette River in Portland, Oregon every day—2.5 miles each way—and that’s when he’s in a hurry. Other days he takes the scenic route. And a Newport, Rhode Island commuter even documented his daily 4-plus mile trek in a YouTube video, complete with surfer-themed music.
Perhaps unsurprisingly, some paddle-board commuters have the waterways to themselves in the morning. Maybe Rhode Island has the solution to easing traffic congestion and freeing up seats on public transportation. And because this interpretation applies as of July 1, 2014, paddleboard commuters can race out and buy their new boards tax free right now.
Continue the conversation on Bloomberg BNA’s State Tax Group’s LinkedIn page: Should a few ambitious commuters justify an exemption for all paddleboard sales?
Sign up for a free trialof the Bloomberg BNA Premier State Tax Library and see a detailed discussion on state property taxes.
Follow me on Twitter: @MikeKerman
Follow us on Twitter: @BBNAtax
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)