NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A3677B
SPONSOR: Lupardo (MS) TITLE OF BILL: An act to amend the tax law, in relation to exempting
from sales and compensating use taxes the purchase of general aviation
aircraft; and providing for the repeal of certain provisions upon expi-
ration thereof
PURPOSE OR GENERAL IDEA OF BILL: This bill would exempt from sales
and use taxes the purchase of general aviation aircraft.
SUMMARY OF SPECIFIC PROVISIONS:
§ 1- This act shall be known and may be cited as the "New York Aviation
Jobs Act".
§ 2- Amends Tax Law § 1115 (dd) by amending paragraph 1 to exempt from
sales and use taxation the purchase of general aviation aircraft similar
to the current exemption granted to commercial service aircraft.
§ 3- Effective date.
JUSTIFICATION: Airports are one of the economic engines that fuel
growth in the communities that they serve. The economic benefits of
airports in this state are quite large.
Annual economic activity attributable to aviation is $36 billion. Over
300,000, New York residents owe their jobs directly or indirectly to
airports. These jobs pay nearly $12 billion in payroll on an annual
basis. Airports and aviation industries pay over $2.7 billion in state
and local taxes each year.
New York air service is critical to the economic well-being of This
state and to the traveling public. Airline commercial service is
provided at 18 airports located in urban and rural areas throughout the
state. In addition to commercial service airports, hundreds of other
general aviation airports are located throughout the state. These
airports provide services such as charter flights for businesses and
executives, quick access for medical emergencies and law enforcement
needs, flight training, and tourism & recreational flying.
This bill will make New York competitive with other states that already
exempt-sales taxes related to the purchase of general aviation aircraft.
Connecticut, Massachusetts, New Jersey and New Hampshire are a few of
the regional states that exempt these aviation purchases from sales and
use taxes or provide more favorable tax treatment.
Since the sales tax exemption for the maintenance, repair, overhaul or
rebuilding of aircraft was enacted in 2004, New York has attracted
significant investment in aviation services. The recent study by the New
York State Department of Taxation and Finance--A Review of the Sales and
Use Tax Exemption for Private Aircraft Parts and Service---demonstrates
that this particular tax exemption has been a tremendous success,
resulting in an expansion of aviation maintenance and repair businesses,
the creation of jobs here in New York and an increase in state tax
revenue.
Should New York exempt the purchase of general aviation aircraft, it
will timber encourage existing aircraft maintenance facilities to expand
their operations. In addition, other companies would look to New York to
locate or relocate their business jets and operations within this state.
Like the maintenance and repair exemption, an exemption for the purchase
of aircraft is expected to increase state revenues and leverage signif-
icant economic returns for local communities and the state.
PRIOR LEGISLATIVE HISTORY: A8856 of 2012.
FISCAL IMPLICATIONS: NYS Department of Taxation & Finance estimates
that state and local governments will see an offset to possible tax
losses with an increased amount of economic development payroll taxes,
property taxes, and sales taxes in other ancillary services and
increased fuel tax collections from aircraft maintenance and in-state
basing as a result of the increase in aviation activity.
EFFECTIVE DATE: This act shall take effect immediately and shall
apply to sales made, services rendered and uses occurring an or after
such date in accordance with the applicable transitional provisions of
sections 1106 and 1217 of the tax law. The commissioner of taxation and
finance shall be immediately authorized to adopt and amend any rules or
regulations and issue any procedure, forms or instructions necessary to
implement this act on its effective date.
STATE OF NEW YORK
________________________________________________________________________
3677--B
2013-2014 Regular Sessions
IN ASSEMBLY
January 28, 2013
___________
Introduced by M. of A. LUPARDO, SCHIMMINGER, BOYLAND, MAGNARELLI,
LIFTON, MORELLE, COOK, SCARBOROUGH, TITONE, WEISENBERG, CAHILL,
LAVINE, MILLER, WEPRIN, TITUS, BRINDISI, ENGLEBRIGHT, GUNTHER, BARRETT
-- Multi-Sponsored by -- M. of A. ARROYO, CERETTO, CRESPO, CROUCH,
DIPIETRO, DUPREY, FINCH, FITZPATRICK, GLICK, GRAF, HAWLEY, HEASTIE,
HOOPER, P. LOPEZ, LUPINACCI, MAGEE, MARKEY, McLAUGHLIN, MONTESANO,
OAKS, PALMESANO, PAULIN, PERRY, PRETLOW, RAIA, SALADINO, SCHIMEL,
SWEENEY, WRIGHT -- read once and referred to the Committee on Ways and
Means -- committee discharged, bill amended, ordered reprinted as
amended and recommitted to said committee -- recommitted to the
Committee on Ways and Means in accordance with Assembly Rule 3, sec. 2
-- committee discharged, bill amended, ordered reprinted as amended
and recommitted to said committee
AN ACT to amend the tax law, in relation to exempting from sales and
compensating use taxes the purchase of general aviation aircraft; and
providing for the repeal of certain provisions upon expiration thereof
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Short title. This act shall be known and may be cited as
2 the "New York aviation jobs act".
3 § 2. Paragraph 1 of subdivision (dd) of section 1115 of the tax law,
4 as added by section 1 of part L of chapter 60 of the laws of 2004, is
5 amended to read as follows:
6 (1) Services otherwise taxable under paragraph three of subdivision
7 (c) of section eleven hundred five or under section eleven hundred ten
8 of this article, sales of general aviation aircraft, and tangible
9 personal property purchased and used by the person who sells such
10 services in performing such services, where such property becomes a
11 physical component part of the property upon which the services are
12 performed or where such property is a lubricant applied to aircraft,
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD01351-07-4
A. 3677--B 2
1 shall be exempt from tax under this article where such services are
2 performed on aircraft.
3 § 3. The commissioner of taxation and finance, in conjunction with the
4 commissioner of transportation, shall review and analyze all statistical
5 data available for the purpose of determining the economic and revenue
6 impact of the sales and compensating use tax exemption for the sale of
7 general aviation aircraft enacted by section two of this act. Such
8 review and analysis shall include, but not be limited to, any increases
9 in aviation-related employment, aircraft basing, aircraft maintenance
10 and aircraft hangering within the state. The commissioner shall compile
11 his or her findings into a report, which shall be submitted, on or
12 before November 1, 2019, to the governor, the temporary president of the
13 senate and the speaker of the assembly.
14 § 4. This act shall take effect April 1, 2015, and shall apply to
15 sales of general aviation aircraft made and uses occurring on or after
16 such effective date in accordance with the applicable transitional
17 provisions of sections 1106 and 1107 of the tax law, but shall not apply
18 to sales occurring after March 31, 2020, and section two of this act
19 shall expire and be deemed repealed April 1, 2020. Provided, however,
20 that aircraft subject to exemption pursuant to paragraph 1 of subdivi-
21 sion (dd) of section 1115 of the tax law, as amended by section two of
22 this act, shall remain so exempt after the expiration and repeal of
23 section two of this act, including instances where the aircraft is
24 subsequently sold or the ownership is transferred or assigned, for the
25 useful life of the aircraft. Provided, further, that the commissioner of
26 taxation and finance shall be immediately authorized to adopt and amend
27 any rules or regulations and to issue any procedure, forms or
28 instructions necessary to implement section two of this act on its
29 effective date.
