New Dogfight Between Obama and Private Jet Industry

[G4dude]

Your NBAA dues hard at work.

Congressional taxation and economic studies show that bonus and depreciation benefits do not impact a buyer’s decision. (If you want the study, I will post it but I read on November 17th and I have to find it again.)

Pick another fight…you’re fighting windmills…you’re dating Lennay Kekua…you don’t know what you are doing!

Congress said the same things when it voted to impose a luxury tax on yachts. It almost killed the industry, and Congress quietly repealed the tax.

 

[Sparse]

Ineffectiveness of Bonus Depreciation to Stimulate Economic Growth

CRS Report for Congress (discussion starts on page 10)

​

http://www.nationalaglawcenter.org/assets/crs/RL31852.pdf

Bonus Depreciation Tax Cut Unlikely To Provide Effective Economic Stimulus

​

http://www.cbpp.org/cms/index.cfm?fa=view&id=579

I think the NBAA has a better feel of what stimulates a buyers decision to purchase an aircraft not some bureaucrats in Washington. I thought they learned their lesson with the luxury tax.

 

[NJAowner]

In most cases people and business who have decided to take the plunge and expense of private aviation will do so regardless of whether the jet can be written off in 5 or 7 years. It is like large charitable donations -- when someone donated $10MM for a new wing to a hospital or college, they do it for chartitable reasons -- the tax deduction is secondary.

In some cases accelerated depreciation may accelerate the purchase of a replacement aircraft. Also, the accelerated depreciation is most often used by private companies, not the Fortune 100 types that have the largest flight departments -- depreciation is an expense which trickles down to reducing net income and earnings per share, so for many public companies spreading out the depreciation is favorable. On the other hand, private companies are more concerned with reducing taxable income and will be in favor of the quickest depreciation schedule.

Don't get me wrong -- it is very, very nice to have accelerated depreciation as a private company. But the vast majorityu of them would still utilize private aviation regardless of whether the write off was 5, 7 or 10 years.

 

[gret]

I think the NBAA has a better feel of what stimulates a buyers decision to purchase an aircraft not some bureaucrats in Washington. I thought they learned their lesson with the luxury tax.

Wish this was true, but if you look at the leadership of the NBAA and the immediate past president at NATA, both were/are long time Washington bureaucrats. New president at NATA has a practical background flying for Delta I believe.

 

[rajflyboy]

Greg voted for Obama

 

[gutshotdraw]

Greg voted for Obama

Whoever Greg is, there are two possibilities:

1) Greg is a kind, considerate soul who truly believes the best way to help the poor, the unemployed, the sick, and the oppressed is larger and ever expanding government at every level and the rising taxes that must accompany that government growth;

Or

2) Greg is a delusional, angry, get-even-with-em moron willing to ignore recorded human history and reams of statistical data that prove this Administration's view on the role of government NEVER results in the financial and personal success of the individual OR the society but instead ultimately results in widespread misery, poverty, and malaise.

 

[gret]

Yeah...that Greg guy is a real idiot!

 

[rumrnr78]

Whoever Greg is, there are two possibilities:

1) Greg is a kind, considerate soul who truly believes the best way to help the poor, the unemployed, the sick, and the oppressed is larger and ever expanding government at every level and the rising taxes that must accompany that government growth;

Or

2) Greg is a delusional, angry, get-even-with-em moron willing to ignore recorded human history and reams of statistical data that prove this Administration's view on the role of government NEVER results in the financial and personal success of the individual OR the society but instead ultimately results in widespread misery, poverty, and malaise.

I vote for #2!

 

[G4dude]

Whoever Greg is, there are two possibilities:

1) Greg is a kind, considerate soul who truly believes the best way to help the poor, the unemployed, the sick, and the oppressed is larger and ever expanding government at every level and the rising taxes that must accompany that government growth;

Or

2) Greg is a delusional, angry, get-even-with-em moron willing to ignore recorded human history and reams of statistical data that prove this Administration's view on the role of government NEVER results in the financial and personal success of the individual OR the society but instead ultimately results in widespread misery, poverty, and malaise.

I vote for #1, with the results of #2. These folks have the best intentions, but the consequences of their policies are devastating. Greg, whoever you are, stop voting that way!

 

[AirCobra]

While no big fan of President Obama's policies, I have to agree that tax write offs have little or no bearing on the decision for a wealthy person or corporation to purchase a business jet. I have been flying corporate for seven years and I would say the prime motivating factors for business jet purchases are convienience coupled with status. It seems to me as with houses, people will purchase the biggest jet they can afford regardless of whether or not it makes sense to fly a G-550 or Global Express with one person it 150 miles. I don't think the purchase of these aircraft hinged on a tax write off.

The wealthy stay wealthy by having batteries of orgnaizations, lobbyists, and lawyers working full time to protect their interests always coupled with some idle threat. That is why they pay a lesser percent in taxes on the purchase of a jet or yacht then you or I will if we bought a Chevy.

When I flew Part 135 I used to hear idle threats all day from wealthy people against their staff, the FBO, the car service, sometimes my company, but it was usually all bluster. This I beleive is just more of the same.