John Kerry's Problem with Taxes Shows the Problem with Taxes

It's a simple matter of What Did He Own and When Did He Own It?

The Boston Herald's gossip columnists, the "Inside Track Gals," are said to have broken the story of the summer in exposing Sen. John Kerry's (D-MA) tax evasion or tax avoidance after purchasing a yacht:

The Track broke the story of the summer last week when we reported that the former White House wannabe had purchased a spankin’-new 76-foot luxury yacht in New Zealand and registered it in Rhode Island, thus dodging Massachusetts’ 6.25 percent sales tax and depriving the senator’s summer home, Nantucket, of some $70,000 a year in excise taxes.

Local talk radio has been abuzz with glee -- while local boatwrights fumed -- over the story and over the senator's refusal to answer questions about the matter.

Sen. John Kerry, hounded by questions over whether he is dodging state and local taxes on his ultra-luxe $7 million sailing yacht, yesterday slammed his car door on a pack of reporters demanding to know if he would pony up to the cash-strapped commonwealth.

While I have never been a fan of John Kerry's politics, and don't like when politicians duck questioners, I see this situation as more about the state of our tax codes than which state's tax codes.

The Ocean State repealed its Boat Sales and Use Tax back in 1993, making the tiny state a haven... for tax-skirting luxury yacht owners.

However, according to state law, if Kerry brings the boat into Massachusetts waters in the first six months of owning it, there is a “presumption of use” and he would have to pony up some $437,500 to the state.

When asked yesterday whether he had brought the Isabel into Massachusetts, Kerry replied, “It depends on who owns it.”

Clear as the Gulf of Mexico, right? It gets better:

Maritime law expert Brian Flanagan, who teaches admiralty law at Suffolk University Law School, said it is possible Kerry may have taken possession of the custom-built craft more than six months ago, even though he registered it with the Coast Guard on March 12. Another source suggested that Kerry has not yet paid in full for his new high-seas plaything.

But even if they didn’t beat the six-month deadline, John...also could challenge the state’s “presumption of use” and present evidence that he did not purchase the vessel for use in the commonwealth, Flanagan said.

State Treasurer Tim Cahill, a former Democrat running for governor as an independent, was quick to chastise his "former" party-mate in a desperate attempt to flee the Democrat party:

It looks to me like he’s avoided taxes by registering in Rhode Island. So if someone’s not paying their taxes that should be paying them, then the DOR should go after them..."

I don't begrudge Sen. Kerry his big fancy yacht. After all, he earned his money the old fashioned way, he married into it (twice!). But, don't you think the tax structure in this country is completely out of control when you can be charged sales tax in Massachusetts on a boat you bought in New Zealand and want store in a Rhode Island based on a "presumption of use" if you dare sail into Massachusetts waters within the first six months?

As Republican candidate for MA governor says: Had Enough?