State of Rhode Island - Division of Taxation
Sales and Use Tax
Regulation SU 87-41 (Repealed Effective July 29, 1993)
Boat Rentals and Leases
Every person, firm or organization engaged in the business of holding a boat out for lease or rental in Rhode Island without the service of a captain either on its own behalf or on behalf of another party is required to register for a sales tax permit to collect and to remit the sales tax on all such leases and rentals.
A company which leases, rents or charters a boat without a captain on behalf of the owner and acts as a liaison between the lessee and the owner and who is responsible for the collection and the accounting of rental or leasing fees on behalf of the owner is required to register for a sales tax permit to collect and to remit the sales tax on all such leases and rentals.
Notwithstanding provisions of federal law or regulation requiring the captain to be an agent or employee of the lessee, the lease, rental or charter shall be deemed to be a service and not subject to the imposition of the sales tax provided the captain is furnished by the owner. If the captain in fact is furnished by the lessee, the lease, rental or charter is considered "bare boat" and is subject to the tax.
A lessee who transacts a lease or rental of a boat with an out-of-state source for use in Rhode Island waters is responsible for the payment of the Rhode Island sales/use tax and for the filing of a "Consumer's Use Tax Return" with this Division.
Cross Reference: SU 92-62 - Rentals and Leases of Tangible Personal Property
R. GARY CLARK
DATE: January 1, 1994
THIS REGULATION IS REPEALED AS OF JULY 29, 1993 TO COINCIDE WITH THE EFFECTIVE DATE OF THE REPEAL OF THE SALES/USE TAX ON BOATS.