Story ID: 
Canada Revises Proposed Aircraft Luxury Tax
By: Gordon Gilbert
Caption: Canada has stepped back from its previous position that could have seen virtually all private aircraft purchased taxed as luxury “personal” aircraft.
Word Count: 210
After intense lobbying efforts by the Canadian Business Aviation Association, the Canadian Owners and Pilots Association, and the business aviation community, the federal government has stepped back from its previous position that could have seen virtually all private aircraft purchased in Canada taxed as luxury “personal” aircraft.

New draft legislation published last week proposes that tax relief is to be expanded to take into account “qualifying flights that are conducted in the course of a business with a reasonable expectation of profit.” Comments on the revised proposal are due by April 11.

“The CBAA team is currently reviewing the proposed legislation,” said the association. “This is a huge win for our entire sector: operators, manufacturers, and suppliers, and the jobs they represent.”

In last year’s federal budget, the government of Canada proposed a tax on the sale of new luxury cars and private/corporate aircraft with a retail sale price exceeding $100,000 and new boats over $250,000. The tax would be calculated at the lesser of 20 percent of the value above these price thresholds or 10 percent of the full value of the luxury vehicle, aircraft, or vessel.

Under the current proposal, the tax law is set to come into effect on Sept. 1, 2022.