Sales tax exemptions for aircraft in Massachusetts at risk

AOPA Eastern Regional Manager Sean Collins testified virtually before the Joint Committee on Revenue on January 21, opposing Massachusetts Senate Bill 1797, a measure intended to repeal sales tax exemptions for aircraft.

Commending Massachusetts’ booming aviation industry in his testimony, Collins noted that “Massachusetts sets the standard for success in the general aviation industry in New England.” The state has 38 public-use airports that contribute more than 199,237 jobs. The airports also provide $7.2 billion in annual payroll and produce a total economic impact of nearly $25 billion each year, according to the Massachusetts Department of Transportation. Collins pointed out that the industry’s prosperity is due in large part to the 2002 legislature establishing sales tax exemptions on aircraft storage, sales, and maintenance that led to approximately $1 billion in state revenues annually.

By repealing these important sales tax exemptions and subjecting aircraft to the state’s 6.25-percent sales tax, Collins warned that aircraft owners may look elsewhere as neighboring states like Connecticut, New Hampshire, New York, and Rhode Island currently offer sales tax exemptions to aircraft. Collins reiterated that “states that experience the broadest range of industry growth employ a comprehensive aviation incentive plan extending to both aircraft and maintenance. This combination attracts the greatest number of aircraft, directly supporting aviation jobs and the airports that rely on them.”