Capital Clicks

Airport association seeks sales tax break

By: - January 7, 2020 12:59 pm

The Iowa Public Airports Association has called for the Iowa Legislature to support House File 607, which would exempt aircraft parts and labor from state sales and use taxes.

The association notes that Illinois, Minnesota, Missouri, Nebraska and Wisconsin already exempt aircraft parts and labor from sales tax. Iowa could miss economic developments related to aviation because of that disparity, the association maintains.

The organization says Iowa aviation supports 16,549 jobs with a combined payroll of $587 million.

“Neighboring states with the tax exemption enjoy considerably more robust aerospace economic development,” the airport association noted in its 2020 legislative priorities report. “Indian Hills Community College and Iowa Western Community College are leaders in aircraft maintenance degrees. Such an exemption would help grow local jobs and potentially keep more of our young people who are educated in Iowa, staying in Iowa.”

By the association’s count, 34 states have sales tax exemptions for the equipment and repairs. 

“This bill is about helping Iowa employers offer competitive pricing to rival prices offered by out-of-state companies, an especially important consideration when planes are, by definition, very portable,” the association reported. “This is not a tax break for aviation companies because sales taxes are passed onto the customer.”



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