Canada: Luxury Tax

A luxury tax on the sale of new high-end autos and boats also applies to new general aviation aircraft in Canada or those imported and is scheduled to go into effect Jan. 1, 2022. The tax on aircraft is calculated at the lesser of 20 percent of the value above the threshold of $100,000 or 10 percent of the full value of the aircraft, whichever is lesser. “New” aircraft are defined as those manufactured beginning in 2019. The Canadian Business Aviation Association, the Canadian Owners and Pilots Association, and other trade groups have been trying to either get the rule to apply to a much greater threshold and to delay its effective date.