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Thu, Jul 08, 2004

Rhode Island Repeals Aircraft Sales And Use Taxes

Now THAT'S Tax Relief

Rhode Island Governor Donald Carcieri made it official Monday -- the repeal of aircraft sales and use taxes. The repeal, effective January 1, 2005, exempts the sale, storage, use or other consumption of new or used aircraft and aircraft parts from taxation. Labor charges continue to be exempt where labor charges are separately stated by the seller.

Signing of the legislation concludes more than one year of work by a coalition of general aviation organizations, led by National Business Aviation Association (NBAA) Regional Representative Dean Saucier and NBAA Tax Committee member Ed Kammerer of Edwards & Angell, LLP. The coalition included NBAA, the Rhode Island Aviation Association, AOPA, the Rhode Island Pilots Association and several local pilots' organizations.

This tax repeal legislation became a priority in Rhode Island as a result of a series of ambiguous legal rulings that allowed the aircraft sales and use tax to be applied to non-resident companies. Neighboring states Connecticut and Massachusetts also exempt aircraft from sales and use taxes.

"Aircraft operations require significant support from ground services and personnel, thus creating substantial economic benefit to the states and localities," said Mike Nichols, NBAA manager, tax & finance issues. "Rhode Island will now be on par with its neighboring states providing equitable tax treatment of aircraft. We expect this will translate into additional jobs for the residents of Rhode Island."

FMI: www.nbaa.org/taxes

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