A bill to make permanent a sales tax exemption on maintenance and repair of aircraft and remove the sales and use tax on the purchase of GA aircraft is gaining support in the New York legislature.
AOPA worked with legislators to create the sales tax exemption for aviation parts and maintenance in 2004. The next year, the state saw an increase in taxable income from businesses involved in aviation maintenance and repair and a three-percent jump in employment in the sector, according to a report from the state’s Department of Taxation and Finance. Department surveys indicated a 17-percent increase in revenues over that year.
Still, the state could soon lose the economic benefits of aircraft-related businesses, because the tax exemption is set to expire on Dec. 1.
“The aircraft and repair exemption that started in 2004 saved pilots money and led to a boom in business and increased revenue for the state,” said AOPA Vice President of Airports and State Advocacy Greg Pecoraro. “If the legislature does not extend the exemption, New York could lose significant aviation business to neighboring states. So this legislation is critical to the continued vitality of this important sector of the state economy and transportation system.”
The New York Aviation Jobs Act would make the tax exemption permanent and add an exemption for the purchase of GA aircraft. In a letter to Speaker of the State Assembly Sheldon Silver that is still gaining co-signers, Assemblyman Robin Schimminger wrote that the current sales tax on aircraft is driving business out of New York into neighboring states.
“New York needs to stem the relocation to other states of job-creating aircraft purchases by eliminating the sales tax on the purchase of these aircraft in New York,” the letter reads. AOPA is working with Schimminger, legislators, and other aviation groups to add co-signers and thus add momentum for the bill’s passage.
Considering the boom to New York’s aviation maintenance industry and the resulting growth in taxable business caused by the 2004 exemption, the legislators wrote, “[w]e are confident that further aviation sales tax relief will succeed in attracting additional basing of aircraft in New York.”