Advocates press Maryland tax exemption for aircraft parts
Two AOPA-backed bills that would make aircraft maintenance and repairs more competitively priced by exempting parts from sales tax continue to move forward in the Maryland legislature.
House and Senate committees held hearings on the parallel measures sponsored in their respective chambers in late January. The Senate passed its bill and sent it to the House on January 21.
As the push to pass a sales tax exemption for aircraft components refocuses in 2020, AOPA continues to work in conjunction with an industry coalition with participants and supporters from Washington County to Wicomico County, as well as the Maryland Airport Managers Association.
In an effort to address lawmakers’ concerns about tax revenue, AOPA proposed language that was included in the bill for the sales tax exemption on parts to apply to aircraft less than 12,500 pounds maximum gross takeoff weight, and to heavier aircraft used predominately in interstate and foreign commerce.
Supporters continue to make the case to lawmakers that the industry’s competitiveness with surrounding states hinges on their action. Maryland and Delaware are alone in the eastern region in not providing some level of tax exemption for aircraft parts and components—and Delaware’s sales tax is less than 1 percent.
“This creates a significant disadvantage for Maryland airports and locally based maintenance facilities, making it difficult for them to keep business from going to repair facilities in neighboring states—namely Pennsylvania and Virginia—that can offer a relative discount to customers,” Collins said.
Collins added that creating a level playing field for aircraft repair shops in Maryland would provide job opportunities for students studying in career and technical education programs such as those using AOPA’s High School Aviation STEM Curriculum and to collegiate programs at the University of Maryland Eastern Shore, Community College of Baltimore County, and the Pittsburgh Institute of Aeronautics satellite school in Hagerstown.
Absent local job growth, those students would likely be forced to seek employment out of state, where demand for maintenance services would likely keep its competitive edge.
Increasing in-state demand for skilled workers in aviation technical jobs would also support the recommendations of the Kirwan Commission, which has issued a report on educational priorities and funding that is “consuming much of the political oxygen” in Annapolis, the state capital, Collins said, noting that recommendations included establishing an effective career and technical education system.
To bolster the legislative effort, AOPA continues to encourage aircraft repair station operators in Maryland to participate in a survey designed to provide data on the industry’s condition in the state. For more information about the survey, email Collins.
