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Maine 'tax cut' would adversely affect aircraft owners

Maine 'tax cut' would adversely affect aircraft owners

A $140 million tax cut for Maine residents sounds good on the surface, but if you dig deeper, it doesn't look so great.

The proposed tax cut, Legislative Draft 1925, would actually create a new 5 percent sales tax on the repair, maintenance, and installation services of "tangible personal property," including aircraft.

"While this bill would give most Maine residents a modest income tax cut, it could mean a significant increase in costs for pilots," said Greg Pecoraro, AOPA vice president of regional affairs. "The bill could be up for a vote before the state Senate any day, and we're urging Maine members to contact their senators and tell them to vote against L.D. 1925."

The proposed tax could also hurt aviation business in the state because aircraft owners would turn to maintenance shops in nearby states with more favorable taxes.

June 18, 2007

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