Repeals Exemption For Aircraft Parts And Maintenance, Assesses Personal Property Tax

Connecticut Governor Dan Malloy (D) released his budget proposal on February 17, 2011, which includes a provision impacting aviation in the state. The proposal would repeal the current tax exemption for aircraft parts and maintenance on aircraft under 6,000 pounds and assess personal property tax on aircraft.  House Bill 6387, if passed, would tax aircraft at 70% of their value factored by a millage rate of 20. Millage is defined as one dollar for every $1,000 of assessed value.  For example, a corporate jet valued at $20 million would be assessed an annual tax of $280,000.  It appears that there is no weight limit associated with this proposal, meaning all aircraft in the state would be impacted.

Governor Dan Malloy

The Connecticut House of Representatives Committee on Finance is expected to convene within the next few days to begin work on this and other bills. 

NATA is urging its members who have an interest in the state of Connecticut to respond to this call to action immediately. Contact the governor's office and elected representatives in Connecticut to voice your opposition.  

NATA says when talking to legislators, the following points should be made:

• Surrounding states, Maine, Rhode Island, New Jersey, and New York, do not impose personal property taxes on aircraft.  Therefore, because aircraft are mobile assets, owners, especially corporate owners, are likely to reestablish their aircraft in one of those states.
• Airports and airport-based businesses will lose revenue from loss of fuel, hangar and maintenance purchases. 
• Aerospace and aviation provide 45,800 jobs, resulting in a $2.77 billion payroll to the state.
• This tax proposal will result in a significant loss of jobs and revenue as aircraft owners seek to avoid this onerous tax proposal.

NATA strongly encourages its members to be outspoken in opposition to HB 6387. The association has worked with its members in various states and has defeated similar budget proposals, but says your immediate action is required.

FMI: www.nata.org