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New Jersey looks to raise taxes on avgas and jet fuelNew Jersey looks to raise taxes on avgas and jet fuel

State legislators “unaware” of FAA rulesState legislators “unaware” of FAA rules

The New Jersey legislature is considering raising taxes on both avgas and jet fuel. AOPA estimates that the legislation would increase fuel tax costs to as much as 37 cents per gallon, with additional increases each year thereafter.
Economic trends and the worldwide financial market can affect general aviation. iStock photo.

The tax is part of a plan for a 10-year infrastructure fund and Sen. Paul Sarlo (D-N.J.), who sponsored the legislation, said that it would call on “out-of-state travelers” to foot more of the infrastructure bill in New Jersey beyond just airports.

One hurdle facing the new tax is that the FAA has very specific rules limiting how revenue from a state aviation fuel tax can be spent.

Politico reported that New Jersey lawmakers “seemed to be unaware of the specific circumstances surrounding the FAA rules.”

When asked about the FAA requirements on fuel tax revenue, Sarlo said, “This is news to me.”

Sean Collins, AOPA's Eastern regional manager, said the tax would hurt local airports and fixed-base operators and encourage pilots to seek out lower fuel costs in neighboring states. “General aviation contributes 16,200 jobs and more than $1 billion to New Jersey’s economy, and this legislation will move a significant amount of that business elsewhere, especially considering a majority of New Jersey GA aircraft are within 30 minutes of an airport in a neighboring state,” said Collins. 

AOPA has asked New Jersey members to contact their representatives to oppose the tax increase.

UPS, which has recently expanded its presence in New Jersey, wrote a letter to New Jersey lawmakers urging caution: "UPS looks very closely at state aviation fuel tax rates given the large percentage fuel plays in our expenses. Heavy tax increases like the one proposed on jet fuel could be detrimental to that future growth."

Airlines for America, which represents various scheduled aviation groups, issued a statement calling the legislation “stunningly shortsighted.”

Joe Kildea

Joe Kildea

AOPA Senior Director of Communications
Joe is a student pilot and his first solo flight was at AOPA’s home airport in Frederick, Maryland. Before joining AOPA in 2015, he worked for numerous political campaigns, news organizations, and the White House Press Office.
Topics: Advocacy, Economic Impact, Taxes

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