Washington repeals crippling aircraft luxury tax

Washington’s luxury tax was enacted in 2025 and would have implemented a 10-percent tax on aircraft worth more than $500,000 to fund sustainable aviation fuel (SAF) production in the state.

Despite sustained opposition during the 2025 legislative session—including testimony from AOPA Northwest Mountain Regional Manager Brad Schuster, and member calls to action—the tax became law and was scheduled to take effect on April 1.

“Lawmakers quickly realized their mistake last year as flight departments began leaving the state, and in-state aircraft purchases were canceled or put on hold,” said Schuster. “Getting this tax repealed was AOPA’s top priority in Washington State this year—and. working with a large number of organizations and stakeholders, we collectively succeeded.”

As lawmakers debated the bill to repeal the tax, they sought alternative ways to fund SAF production. Instead of the luxury tax, the new bill increased fuel excise taxes by 7 cents per gallon, and increased aircraft registration fees, to fund it. Schuster said this creates its own issues, including compliance with federal law requiring aviation fuel taxes to be directed to airports.