Mark Zuckerberg and his superyacht are a match that’s been grabbing headlines ever since they became public knowledge. This time, however, the rumor mills are churning out some unpleasantness. It was revealed on Twitter or X, as it is now known, that Meta CEO Mark Zuckerberg’s new $300 Million yacht has made Fort Lauderdale, Florida, its current home and instead of the American flag its sailing under a Marshall Islands Flag. There is nothing out of the ordinary about it until the photos are followed by the claim that the centibillionaire, worth $179 billion, chose to register his mega yacht in the Marshall Islands in an attempt to avoid paying United States taxes, per Loomered. Zuckerberg’s yacht was originally built for a Russian oligarch, Valdimir Potanin, and became available for Zuckerberg to purchase due to the United States sanctions against Russia.
Zuckerberg’s yacht purchase has become the cynosure of conjecture ever since it made its way to the United States. Now the absence of a US Flag is becoming conspicuous but there is more to the flag registration than just evasion of taxes. Till 2018, a 1920 U.S. law defined a yacht as a vessel whose volume was a maximum of 300 GT. It was President Trump who approved a bill allowing American owners of large yachts to finally register their vessels under the United States flag.
Still, there are several rules and regulations that may make billionaires look in the direction of foreign flags. For yachts registered under the US flag, the captain and officers are required to be citizens or naturalized citizens of the United States, carrying a US passport. There’s also a 75/25 rule permitting only 25 percent of the unlicensed crew to be permanent US residents, but 75 percent are required to be US passport holders, per Hill Robinson.com.
Barrett Wright, President Of Hill Robinson USA, explained, “It’s really difficult to find quality US crew with the right qualifications and it’s very frustrating. And this means that the limited pool of quality US crew out there is in the driving seat with regards to salary demands and compensation. Oftentimes, we find these yachts are having to pay higher than market rate to secure the good crew because they are in such high demand.” Sailing under the US Flag, while extremely patriotic, comes with challenges that make it mandatory for the crew to be employed by a US employer, and requiring them to pay federal withholding tax, Social Security, and Medicare in the United States.
A centibillionaire superyacht owner such as Zuckerberg who would want to use his $300 million yacht both domestically and overseas, the US flag may seem inconvenient with its array of limitations on crew. For those with a longstanding crew, the US flag should not be problematic. He also won’t be permitted to use the motoryacht Launchpad to transfer cargo from his Hawaii property to anywhere else. Popular Youtube Channel eSysman SuperYachts threw light on the fact that one cannot charter a private yacht bearing a US flag which also makes the floating asset seem like a liability when not in use. This however can be turned around by paying the 1.5 per cent duty on a foreign-built yacht to operate the luxury vessel in US waters as private vessels or commercial charters.
A superyacht like Launchpad with amenities like 12 guest cabins, a swimming pool, a glass observation lounge, a spacious beach club, an alfresco dining area, a bar and more can easily be chartered for at least $1 million a week. While chump change for Mr Zuckerberg it can most certainly help offset the $25 – $30 million the Facebook co-founder would spend every year in maintaining the vessel. Maintaining the $300 million Launchpad Yacht would set Zuckerberg back by at least $30 million annually. If the fit Silicon Valley tycoon does decide to charter his shiny new luxury vessel, a lot of the maintenance costs will be taken care of, albeit without the US Flag.
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