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News Link • Transportation: Air Travel

A New Tax on Business Jets Could Be Coming to the U.S.

• https://robbreport.com, By Michael Verdon

The world of private jets will be soon seeing new taxes in the U.K. and France, and legislation proposed this week in Congress is bringing "a fat-cat" tax argument against business aircraft use in the U.S.

U.S. Senator Edward Markey (D-Massachusetts) reintroduced legislation to raise fuel taxes on business jets from 22 cents to $2 per gallon, according to AIN. The Fueling Alternative Transportation with a Carbon Aviation Tax (FATCAT) Act (S.173) would increase fuel taxes to the equivalent of an estimated $200 per tonne of a private jet's carbon dioxide emissions, Markey said.

The bill had been introduced in 2023, with a similar bill put forward in the House by Rep. Nydia Velázquez (D-New York), but both stalled in committee in the last Congress. "It is time to make billionaire fat cats pay the absolute bare minimum to fly private jets and prioritize clean public transportation," Markey said.

Trade groups like the National Business Aviation Association (NBAA) reject the fat-cat description, pointing out that private aircraft are largely used for business purposes. They also note that the industry has a $150 billion economic impact in the U.S. and supports more than a million jobs.

Many private aircraft are used by small businesses as regional transport. "There are more than 5,000 public-use airports in the United States—fewer than 500 have commercial airline service—making business aviation an economic lifeline for thousands of communities," NBAA president Ed Bolen told a Senate hearing. "Business aviation serves also as a lifeline to communities with declining airline service," he added.

With Republican majorities in both houses of Congress, it's unlikely that the Fat Cat tax will ever get out of committee. But in the U.K. and France, per-passenger surcharges will go into effect April 1 and March 1, respectively.

The U.K.'s Air Passenger Duty (APD) for private jets will range from £84 ($106) to £673 ($850) per passenger. The exact rate depends on the class of travel and distance traveled, from zero to more than 5,500 miles. The higher rates depend on the more luxurious aircraft types and classes of service. The goal of the higher ADP was to make sure that private jets contribute to public finances, though the government expects those extra costs to get passed along to consumers.

In France, the per-passenger surcharge could range between $218 and $2,200 per passenger for each flight, depending on aircraft type and destination. The tax, levied on charter jet operators and other business aviation flights, will begin on Saturday. It applies to anyone departing from an airport in France.


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