Building Ships in America Act of 2025

This bill uses tax breaks to boost U.S. shipbuilding, ports, and maritime jobs. It creates a large tax credit to build or upgrade U.S.-flag cargo ships in American shipyards (33%, with small add-ons for U.S. insurance and certain safety classifications) if the ship serves U.S. foreign trade for at least 10 years and isn’t tied to foreign entities of concern. If a company breaks the agreement, the credit can be fully clawed back . It also offers a 25% credit to build or expand U.S. shipyards and critical ship components, through 2032, with rules to prevent double-dipping between the ship and shipyard credits . Up to 100 “maritime prosperity zones” (areas suited for shipyards, ports, or harbor facilities) can be treated like opportunity zones, but only for maritime and shipbuilding industries, and for five years .

The bill updates several tax rules to support the maritime workforce and port communities. Certain federal maritime security payments wouldn’t be taxed . Student incentive payments for maritime training would be tax‑free starting in 2026 . The fuel tax break for some working vessels would extend to ships trading between Atlantic and Pacific U.S. ports starting in 2026 . It modernizes shipping tax definitions, removes a 30‑day limit on domestic operations, and tightens what counts as shipping activities to focus on carrying goods in foreign trade . It also refreshes capital construction fund rules to channel money into new U.S. vessels and cargo gear, while blocking withdrawals to buy fully automated equipment that would cut terminal jobs or to buy cranes made in China, starting in 2026 .

• Who is affected: Shipbuilders, port and harbor communities, U.S.-flag cargo ship operators, maritime students and workers, and related suppliers .
• What changes: Big tax credits for U.S.-built ships and shipyards; new maritime opportunity zones; tax‑free maritime security and student payments; fuel tax parity; updated shipping tax rules; guardrails against job‑reducing automation and China‑made cranes in fund spending .
• When: Most ship and shipyard credits apply to property placed in service after 2025; ship credit requires construction to begin before 2033; shipyard credit ends after 2032; several other changes also start with 2026 tax years .