June 18, 2015

Recent success on aviation tax-policy debates in state legislatures across the country have been welcome news not just for aircraft owners and operators, but for those who benefit from the job growth and economic activity the policies create.

“Sound tax policies that will benefit aviation businesses and aircraft owners have been passed by legislatures in a number of states, including Texas, Nevada, South Carolina and New York,” said Scott O’Brien, NBAA’s senior manager of finance and tax policy. “By implementing favorable new tax statutes, these states have shown that they understand the importance of general aviation to their economies.”

NBAA, working together with local and regional groups, as well as other organizations, played a significant role in the passage of the aviation-friendly policies, several of which strengthen the states’ competitive position for attracting business activity.

“The tireless efforts of our headquarters staff and regional representatives, together with the hard work put in by many NBAA Members across the country, have resulted in aviation tax reform that will positively affect business aviation in these states,” said Ed Bolen, NBAA president and CEO.

Here’s a roundup of some recent victories:

  • A new law in Texas provides clear guidance and objective standards in the state tax code for application of sales and use tax to aircraft owners and operators. In years past, operators, especially those using aircraft leasing structures, had been subjected to confusing and contradictory interpretations during the state tax audit process.
  • In Nevada, a new law abates certain tax liabilities for those who own, operate, manufacture and service general aviation aircraft if certain economic development thresholds are met. All states bordering Nevada already offer varying levels of tax exemptions for general aviation aircraft. Lack of a similar policy in Nevada had put the state at a competitive disadvantage.
  • South Carolina recently passed a sales tax exemption on parts and supplies used in repairing or reconditioning aircraft, which is expected to help attract aviation activity to the state. Previously, South Carolina law had restricted the exemption to only parts and supplies used in the repair of government or commercial aircraft.
  • In New York, all non-commercial general aviation aircraft are now exempt from the state’s sales and use tax, bringing the Empire State in line with surrounding states that have similar exemptions.
  • The Arkansas legislature has passed a sales-and-use tax exemption for aircraft maintenance service, as well as a flyaway exemption for aircraft sales.

Meanwhile, in Massachusetts, NBAA remains in the forefront of efforts by the state’s aviation community to maintain the state’s exemption on sales of aircraft. NBAA also will continue its efforts seek a sales and use-tax exemption for general aviation aircraft in Florida.

Read more about NBAA’s state tax resources.