New York's Aviation Tax Break Due To Expire

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Five years ago, New York passed a law that exempts general aviation aircraft repairs, maintenance and parts from state sales tax, but that tax break will expire on Dec. 1 if legislators don't re-enact it. Albany County Airport Authority CEO John O'Donnell told the Albany Times-Union this week that the exemption created "a substantial boom in business," and he is working for its renewal. In addition, he'd like to see sales tax on aircraft purchases eliminated. Like other states, New York is looking for ways to boost revenue rather than offer exemptions, but O'Donnell says many nearby states provide sales-tax relief and such taxes can be an important factor when companies are deciding where to locate. The current exemptions were a factor in deciding to build a HondaJet maintenance facility in New York, Molly Martin Pearce, a spokeswoman for HondaJet East, told the Times-Union. "Some of our other candidate sites were in states that didn't have this exemption," she said.

NBAA said recently that an onerous luxury tax proposal on business aircraft has been removed from the New York state budget, but under the current proposal previously exempt transactions could now be subject to sales or use tax at a rate of up to 8.75 percent.