With the growing complexity of myriad federal, state and local taxes and fees, and the increasing intensity with which they are enforced, there was plenty to discuss at the Commercial Operators Tax (COT) seminar, held September 7 and 8 in Scottsdale, Ariz. Co-sponsored by Conklin & de Decker and the National Air Transportation Association (NATA), the event attracted business aircraft owners, operators and management companies.
The Italian government has approved an amendment to the contentious tax on business aircraft that it made law on April 29. Now, foreign-registered aircraft operated privately will incur the tax only if they stay for 45 consecutive days, rather than the 48-hour threshold in effect until now.
The Italian government has approved an amendment to the contentious tax on business aircraft that it made law on April 29. Now, foreign-registered aircraft operated privately will incur the tax only if they stay for 45 consecutive days, rather than the 48-hour threshold in effect until now. The amendment, which is expected to be endorsed by the Italian parliament, would also reduce the rate of the tax by 50 percent.
Brazilian tax authorities, police and aviation officials seized nine business jets late last month and have targeted 13 more. Allegedly, Brazilians own and use the jets but registered them overseas to avoid state and federal taxes of nearly 35 percent. The value of the jets, $275 million, is almost equal to the country’s total customs seizures last year. Foreign aircraft can legally remain in Brazil for up to 60 days annually without paying import duties.
The recently approved highway reauthorization bill was passed without repeal of the fuel fraud tax, according to the National Air Transportation Association (NATA). The tax was part of the 2005 highway bill, an effort to prevent truckers from avoiding highway taxes by filling up with jet fuel. NATA plans to continue its efforts to repeal the tax, according to Eric Byer, v-p of government and industry affairs.
Elliott Aviation of Moline, Ill., is waiting for the outcome of a vote on Illinois House Bill 4110 before making an expansion decision. It would grant tax-exempt status on two parcels of ground the MRO leases on Quad-City International Airport, as well as exemption from future property taxes on new improvements. The company released a statement saying it would evaluate other areas of the country for expansion if the bill failed to pass.
A provision inserted into a 2005 highway bill that has given business and general aviation fuel purveyors a collective headache ever since it was enacted might be repealed in the next highway reauthorization bill. Thirty-two members of the House of Representatives signed a letter to Rep. Dave Camp (R-Mich.), chairman of the House Ways and Means Committee, asking that the provision be deleted from new highway legislation now under consideration.
With aircraft owners facing continuing headaches over importing aircraft into the European Union, offshore registrations are increasingly being considered as a more flexible option. At the same time, lawyers have been scrambling to develop elegant solutions to avoid at least immediate liability for punitive rates of value added tax through deferral schemes.
Italy’s parliament passed proposed changes to the aircraft luxury tax today, according to NBAA.
A 1996 document issued by the House Committee on Ways and Means appears to underscore the intent of Congress regarding application of the so-called “ticket tax” (excise tax) to airline passengers. The document contradicts a March 9 Internal Revenue Service memo that seeks to apply the 7.5-percent excise tax to fees charged by aircraft management companies to aircraft owners flying in their own aircraft for their own business or personal reasons.