New Senate ally taking on Florida use tax

February 18, 2010

Sixty days, one bill, and the fate of Florida’s multi-billion dollar general aviation industry at stake: This is the playing field that AOPA and its local allies must navigate to do away with the use tax on out-of-state aircraft and re-open Florida for visiting aircraft owners from around the nation.

Under current law, Florida can levy a six percent use tax on visiting out-of-state aircraft owners who have purchased an aircraft within the past six months even if they have already paid the proper sales tax in their home states. If a lesser sales tax was charged, the state of Florida can tax the remaining percentage (up to six percent). The tax can apply to a broad range of out-of-state aircraft owners—with visits ranging from quick fuel stops or family visits to longer-term stays for flight training or maintenance work.

What does this unclear piece of tax law mean? Simple: Pilots are avoiding Florida; flight paths and flight plans are rerouted, and businesses within the state lose revenue. AOPA made progress on this issue last year with clarified guidelines from the Florida Department of Revenue exempting certain visiting pilots from the tax, but a clear legal exemption has not been passed. This year, a prominent new sponsor, Sen. Mike Fasano, has taken the helm in the Senate to end this detrimental tax policy once and for all.

60 days

When the legislature convenes in March, it will have only 60 days to consider a year's worth of legislation; the ceremonial dropping of a white cloth April 30 means any unfinished business will have to wait until 2011. So preparation and engagement is key.

In a recent speech at the Florida Airports Council Legislative Conference in advance of the Session, President Pro Tempore Fasano, stressed the importance of educating legislators about the urgency and importance of this issue—both before and during the session. “I encourage everyone to get involved in the legislative process and meet with your representatives to support S.B. 220,” Fasano said. “The time to advocate for the aircraft sales and use tax bill is now.”

The senator added that passing this bill would not just be good for aircraft owners and pilots but good for Florida's economy by boosting revenue and saving jobs. With the use tax in effect, aviation businesses have felt a pinch.

John Hurst, the general manager of Sebring Aviation has said that this tax hurts small businesses like his.

“We are interested in our state collecting its fair share of revenue for the excellent job Florida does keeping up the state’s aviation infrastructure,” Hurst said. “However, this tax on visiting out of state aircraft does little to help the state collect revenue, and seriously hurts small businesses like ours. For example, new aircraft owners avoid visiting our annual event, the Sebring Sport Aviation Expo, each year because they are afraid of the ‘Florida New Aircraft Penalty.’” Pilots outside of Florida who purchase aircraft from Sebring are afraid to come back for service as they fear being stuck with a huge fine, he added.

The clarification

Last year, at the request of AOPA, the Florida Department of Revenue issued a clarification saying that pilots visiting Florida for a short, recreational visit, such as for Sun ‘n Fun or AOPA Aviation Summit, would not be subject to these fines.
But to change this law for all visiting aircraft, and bring aviation dollars back into Florida, there must be a legislative fix.

The Florida House unanimously passed a bill with an exemption last year for pilots who were staying three weeks or less for all types of visits, or longer for the purpose of flight training or maintenance. This same exemption swiftly gained the unanimous approval of two Senate committees before stalling in the Ways and Means Committee in the midst of budget negotiations.

On March 2, the Florida legislature will convene, and AOPA and its allies will be working hard in Tallahassee to repeal this tax before the white cloth drops.