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GA aircraft grandfathered under Illinois tax measureGA aircraft grandfathered under Illinois tax measure

The Illinois legislature May 30 approved Senate Bill 2326, a measure that protects aircraft operating under a rolling stock exemption.

Aircraft that are used approximately 33.3 percent in for-hire interstate commerce are exempt from Illinois sales tax under the state’s “rolling stock” exemption. However, because other vehicles, including over-the-road trucks, are operating under a 50-percent-or-more threshold for tax-exempt status, the legislature, at the urging of the Illinois Department of Revenue, sought to require aircraft to achieve the same 51-percent threshold to maintain their rolling stock exemption. AOPA worked with legislators to find ways to protect aircraft operators that may have found themselves in the gray area between the 33.3-percent and proposed 51-percent thresholds.

Late in the session, the Illinois Aviation Trades Association, supported by AOPA, advocated for an amendment to S.B. 2326 that would allow currently registered “rolling stock” aircraft to maintain their exemption, while requiring the new 51-percent threshold for future registered aircraft. S.B. 2336 now grandfathers existing aircraft in at the 33-percent threshold. 

General aviation airports in Illinois support 54,887 jobs and contribute more than $4.4 billion to the state economy. The state is home to 65 charter flight companies, 98 repair stations, and 13 flight schools. There are 116 public-use airports that support 18,601 pilots and 10,578 registered GA aircraft.

“Although we certainly understand the legislature’s interest in standardizing these rates, supporting the IATA amendment to grandfather currently qualified businesses was vital, in our view, to ensure the continued health and vitality of these aviation operations as key contributors to the state economy,” said Mark Kimberling, AOPA director of state government affairs.

Topics: Taxes, Advocacy

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