Association Says New Taxes And Fees Will Stifle Manufacturing,
Cost Jobs
The White House released their blueprint for the Fiscal Year
2013 budget, which sets the Administration's spending parameters.
Manufacturing, which is identified as a key to lifting the economy
and creating jobs, remains a cornerstone of the
Administration’s priority to turn the U.S. economy around and
address the nation’s debt. GAMA welcomes the proposals to
extend 100 percent depreciation for one additional year and the
research and development (R&D) tax credit permanently. However,
general aviation manufacturers remain confounded by the inclusion
of proposals that would hurt the economic recovery of the general
aviation manufacturing industry and cost jobs.
“As an industry, we understand the urgency to address the
fiscal challenges facing the United States,” said Pete Bunce,
president and CEO of the General Aviation Manufacturers Association
(GAMA) (pictured). “However, we have tremendous concerns
about debt-reduction proposals like user fees and changes to the
general aviation aircraft depreciation schedule. We look forward to
being partners with the Administration and Congress in finding ways
to strengthen the U.S. fiscal situation, but general aviation
manufacturers will not stand for any proposals that threaten
safety, jeopardize jobs or endanger the full recovery of the
industry."
Specifically, GAMA has grave reservations regarding the
president’s new tax, couched as a "user fee," which would
require a $100 per flight fee on operators who fly in controlled
airspace. This tax, which Congress has repeatedly rejected, would
not only impose a significant new administrative burden on general
aviation, but it would also necessitate the creation of a costly
new federal collection bureaucracy. General aviation has long paid
its fair share through an efficient per-gallon fuel charge at the
pump and there is no rationale for change.
GAMA also remains baffled that the Administration continues to
propose that the depreciation schedule for general aviation
aircraft used for business purposes should be altered.
Changing from a five-year to a seven-year depreciation schedule in
the United States will hinder recovery of the largest aircraft
market in the world. Moreover, the overheated rhetoric surrounding
this tax provision is harmful to the revitalization of the
industry.
“If President Obama is truly sincere in his goal to
increase U.S. manufacturing and exports, which he repeatedly cites
as key to economic recovery and long-term viability, his
Administration should embrace general aviation manufacturers and
its workforce as a part of the solution, not a target," added
Bunce. "We do not understand how the Administration on the one hand
can propose 100 percent depreciation for an additional year to
strengthen the economy and at the same time attempt to lengthen the
depreciation schedule for general aviation aircraft in 2013 and
beyond. These two proposals are diametrically opposed.”
The Fiscal Year 2013 budget is sent to Congress as a guideline
for Administration priorities, but Congress has the authority to
determine its own spending parameters. Therefore, GAMA will work
with members on both sides of the aisle to convey the ramifications
of these proposals, while also underscoring the benefits of
investment in manufacturing.