Washington State could soon adopt a spending plan imposing a 10 percent tax on the sale of noncommercial aircraft worth over $500,000.
The state Senate last month signed off on the new fee as part of a broader budget proposal known as SB 5801. Backers say the tax is needed to support transportation infrastructure like roads and ferries.
But aviation industry groups and nonprofits have come out against the bill, arguing it will harm businesses, agricultural operators, and volunteers who help transport sick and injured patients across the state. On Monday, a coalition of six organizations sent a letter to Governor Bob Ferguson urging him to veto the sections of SB 5801 dealing with the aircraft tax.
“While we recognize the budget challenges facing the state, this provision would have sweeping, unintended consequences for Washington’s economy, transportation network, and public safety and healthcare services,” the letter read. “Far from targeting only luxury assets, this tax would impact a wide range of essential aviation users.”
The letter was signed by the National Business Aviation Association (NBAA), Angel Flight West (AFW), Corporate Angel Network (CAN), Vertical Aviation Association (VAA), National Air Transportation Association (NATA), and General Aviation Manufacturers Association (GAMA).
The Aircraft Owners and Pilots Association (AOPA) has also come out against the tax.
“The assumption that because aircraft are expensive and therefore a ‘luxury item’ reflects a grossly uninformed understanding of how noncommercial aircraft contribute to our society,” said Brad Schuster, AOPA general manager for the Pacific Northwest and Alaska.
Bearing New Costs
The proposal as currently written would impose a 10 percent tax on the sale of noncommercial aircraft valued at over $500,000, with the tax applied only to the portion of the selling price above that. The tax would also apply to motor homes and boats exceeding $500,000 in value.
The groups opposing the tax have pointed to possible negative effects on the state’s economy, including for businesses that use noncommercial aircraft for employee travel, training, and logistics. Also likely to bear the burden are pilot schools and student pilots, farmers who use small aircraft for crop dusting and seed spreading, aircraft repair stations, and recreational pilots, who are mainly middle class and not extremely wealthy.
Additionally, opponents said the tax would almost certainly harm medevac operators, private contractors brought in to help fight wildfires, and volunteers who provide transportation for patients living in hard to reach rural areas. Angel Flight West and the Corporate Angel Network, two of the signatories of the letter to the governor, carry out such operations.
Ferguson has not commented on the aircraft tax but voiced his discomfort with the general direction of budget talks earlier this month, according to a Washington State Standard report.
“We cannot adopt a budget with anywhere near the level of taxes in the House and Senate plans,” he said.
Ferguson urged the legislature to “immediately move budget discussions in a different direction.”
