Yet Another Charge Inbound for Owners of 'Luxurious' $80,000 Aircraft

While outside the hobby and industry of general aviation terms like "private plane" carry a significant level of high-end, wealthy cachet, the truth is sadly often far from the height of sophistication.

In reality, as many pilots know, personal aircraft are closer in spirit to maintaining vintage, but well-worn automobiles that wouldn't feel at home on an auction block. Canada's Luxury Tax, as written, levies a special charge for those eminently upscale and exclusive vehicles that lie outside the range of average workaday folk.

For boats, those with value in excess of $250,000 ($197,000 USD) are subject to extra taxes, yet aircraft are deemed luxurious at a fraction of that number at $100,000 ($79,000 USD). The tax is simply unrealistic for the imagined owners of these imaginary, high-end aircraft.

Most GA planes are far from upscale or luxurious, being used for flight training, time building, or a range of airborne services. 

As the COPA notes, "A $100,000 aircraft is no luxury and does not belong in the same category as a car of the same value." Indeed, a popular, upscale car like a BMW, Lexus, or Mercedes around that price point is a far, far cry from an equivalently costly aircraft. $79,000 buys you a lot of car: A Lexus LS has a sumptuous leather interior, a 416hp twin turbo V6, heated and cooled power adjustable seats, heated controls, and an infotainment system that wouldn't look out of place on a flight deck. A plane for the same price? Perhaps a 1978 Cessna 172? A Piper Cherokee of the same vintage? Not exactly interchangeable with the Lexus.

$79,000 buys a 4-cylinder, naturally aspirated 150hp Lycoming, an all-original six-pack, and a sun-faded, sweat-burnished leather interior that couldn't be called anything much more than "durable". Heated seats? Surprisingly, the Piper comes fully equipped with them - in the summertime, at least. The seat cooling oddly only works in the winter months, which could be a bug particular to the '77 models.

Looking at them back to back, it's hard to say those two vehicles are anywhere close to equivalent levels of "luxury", but, under the Luxury tax, they are. It shows a fundamental lack of understanding and interest in aviation, COPA notes, to institute the rule as-is without accommodating the special circumstances that surround it. Even worse for a country that claims to support its aeronautical heritage and worries over the impending pilot shortage. 

Adding another charge to those operating affordable aircraft will only worsen the pilot shortage, and won't bring in near the amount of tax revenue the government seems to think.

COPA notes that some of their considerations have been included in the rule, such as exempting flight schools and agriculture operations. Even still, many privately held, recreational aircraft are trainer planes, commonly used to defray the staggering cost for a young pilot to build the hours necessary to climb their way up the industry. 

COPA urges the government to forego the tax as written, saying "COPA has worked with our industry partners and sister associations to advocate for a just and equitable tax that does not single out members of the aviation community. COPA will continue to advocate for the aviation community and work with all our stakeholders to reach that goal. The baseline must be increased, the carryover tax for exempt aircraft should be eliminated and the process must be simplified."

FMI: www.copanational.org