If you’ve flown your corporate-owned aircraft to Canada anytime in the last five years there’s a good chance you’ll be getting a bill in the mail NavCanada for back taxes owed on the fees you paid to the private air traffic control provider. NavCanada spokesman Ron Singer told AVweb that about 3,500 “customers” got bills ranging from $25 to more than $1,000 to cover retroactive assessments of Canada’s Goods and Services Tax (GST). But don’t blame NavCanada and don’t blame the concept of privatization, Singer insists. It’s the Canada Revenue Agency that will get the money and Singer said NavCanada fought to keep the Canadian version of the IRS’s sticky fingers off the money. “This was not our decision,” Singer said. “We did not agree with it.” He also stressed that private owners of aircraft that have visited Canada need not worry about getting a bill. They’ve already paid the GST.
When NavCanada was formed to take over Transport Canada’s ATC duties more than 10 years ago, it was determined that the GST did not apply to navigation fees charged to foreign corporate-owned aircraft. However, during a recent audit of the company (which, by law, isn’t allowed to make a profit) the CRA decided the tax does apply to corporate planes and ordered NavCanada to fork over the money. Singer said the company had no choice but to go through its records and send bills out to recover the money. Complicating the task is that the rate of the tax has been reduced twice, from 7 percent to the current 5 percent during that five-year period. Singer said the majority of bills are less than $200 and only a few are more than $1,000. Anything less than $25 will be written off.
