Aviation Coalition Pushes Back on Biden Fuel Tax Hike Plan

Groups sound the alarm about the government budget plan that they believe would harm U.S. aircraft-related businesses.

Friday, March 15, 2024 at 02:05 PM ET

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A coalition of aviation industry groups is pushing back on a proposal to increase the federal tax on jet fuel. [Courtesy: Meg Godlewski]

Key Takeaways:

The Biden administration proposes a fivefold increase in the federal jet fuel tax for business aircraft operators by 2030, aiming to raise an estimated $1.1 billion for FAA funding, including hiring 2,000 air traffic controllers.
A coalition of aviation industry groups strongly opposes the tax hike, calling it "draconian" and arguing it would detrimentally impact small and midsize businesses that rely on business jets, rather than just C-suite executives.
The administration also seeks to modify the depreciation schedule for purchased aircraft from five to seven years, a change also contested by the industry, which asserts it lacks valid policy rationale and would harm businesses.

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A coalition of aviation industry groups is raising the alarm about a government proposal to increase the federal tax on jet fuel fivefold for business jet operators over the next five years.

President Joe Biden’s 2025 budget proposal would boost the current tax of 22 cents per gallon to $1.06 by 2030, raising an estimated $1.1 billion over the five years. The administration states business aircraft account for 7 percent of FAA airspace workload, but at the present time the current fuel tax only covers 1 percent of the revenue for the federal trust fund for aviation and airports.