Better Keep That Bangor Trip Down To Less Than 20 Days... Or Stay Away Altogether

Is Maine following Florida down the path to becoming an unfriendly haven for pilots? Months after ANN broke the news about the Sunshine State's plans to slap a "use tax" on owners of new aircraft unfortunate enough to then be seen on airport ramps in the state, it appears tax collectors in the Pine Tree state are following suit.

The Augusta Morning Sentinel reports a 2005 revision to Maine's tax policy became effective January 1, that levies taxes on new aircraft owners if their planes spend more than 20 days a year on the ground there. Like Florida's controversial tax plan, it is intended to discourage residents of the state from purchasing planes in states with lesser sales tax, then flying them back home to Maine.

The tax -- up to five percent of the aircraft's purchase price -- also applies to out-of-state owners who purchased aircraft within the past 12 months, and then flew those planes to Maine, even if they don't plan to stay there.

Under the plan, a recent buyer planning to fly their new Cirrus or Cessna to Maine for an extended vacation, over 20 days in length, would have to make up the difference between Maine's five-percent tax, and whatever tax they paid in the state where they actually bought the plane.

The idea is to use the added revenue, which works out to roughly $2 million, to offset a slight tax cut for Maine residents. Larger aircraft -- those weighing over 6,000 pounds -- are exempt from the tax.

Officials with the Maine Revenue Service are also requesting flight plan information from the FAA, so they may track which pilots have recently purchased affected aircraft... and how much time they're spending in Maine.

The policy is a "short-sighted money grab," says Bill Perry, who operates Maine Instrument Flight and Maine Beechcraft at the Augusta State Airport (AUG).

"If you own a plane and a summer home here, or have relatives here and you want to come and visit for month, you're not going do that," Perry said. "The state must want these people not to come here. And they won't, because they're afraid they're going to get nailed on a use tax on their airplane."

Proponents of the plan say the 20-day provision gives pilots enough time to avoid the tax, which is similar to a fee in place for out-of-state residents who trailer their own boats to Maine for recreational use.

"I think (lawmakers in 2005) looked hard to find a balance and looked at the number of days an individual can bring a plane here," said acting state tax assessor Jerome Gerard. "I think it's pretty reasonable when you consider that 20 days doesn't include repair time... It's not that unfriendly."

The Aircraft Owners and Pilots Association says levying such fees on aircraft flying into Maine will likely convince pilots to drive there instead... or, to avoid the state entirely.

"(The policy) also flies in the face of your emphasis on building a 'fair and stable business environment,'" wrote AOPA president Phil Boyer, in a letter to Gov. John Baldacci. "Please know that in the meantime, we will be advising AOPA's 410,000 members outside of Maine to forgo what might be a fairly costly trip to your state."

Baldacci spokeswoman Joy Leach told the paper the governor's office is reviewing AOPA's letter. Similar legislation, that would have handed Maine pilots a tax bill for repairs to their aircraft, recently died in the final moments of the 2007 legislative session, according to AOPA.

Perry believes the new taxes will keep away the planes that keep him, and others, in business.

"Sure, the state may be taking in $2 million, but how much have they lost from people who are saying they will stay right out of Maine?" he asked. "I think they've really shot themselves in the foot this time."

FMI: www.aopa.org, www.maine.gov/revenue/