New Law Will Protect and Grow Aviation Industry Jobs

July 16, 2009

The governor has signed into law legislation (A.8891/S.5516) repealing the sunset date for the current sales tax exemption on the maintenance, repair, overhaul, or rebuilding of aircraft and making the exemption permanent. Assemblyman Robin Schimminger, D-C-I-Kenmore, who sponsored the legislation said, “Airports are one of the economic engines that fuel growth in the communities that they serve.” Schimminger chairs the Assembly Committee on Economic Development, Job Creation, Commerce and Industry.

The economic benefits of airports in this state are significant. Annual economic activity attributable to aviation is nearly $536 billion, and more than 300,000 New York residents owe their jobs directly or indirectly to airports. These jobs pay nearly $12 billion on an annual basis, and 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 and recreational flying.

This extension of an existing law that would otherwise expire this year will maintain New York's competitiveness with other states that exempt sales taxes related to aviation activities. Connecticut, Massachusetts, New Jersey and New Hampshire are a few of the regional states that exempt these aviation sales and use taxes. Since the sales tax exemption for the maintenance, repair, overhaul or rebuilding of aircraft was enacted, New York has attracted significant investment in aviation services, as is evidenced by the decisions by Eclipse Aviation and Honda Aircraft to locate such facilities at Albany International Airport.

“The improvement of our business climate is imperative,” said Assemblyman Schimminger. “We must change the way the Empire State is perceived by the business community as a whole, and by enacting this legislation into law we take another step in the right direction for economic recovery in New York.”