Corporate Jet Use Crackdown Is a Poor Way to Boost Tax Revenue
The US government intends to focus on taxing business aircraft, but it is inappropriate to characterize large corporations and high-net-worth individuals who use business aircraft as “flying under the radar with their tax responsibilities.” The IRS plans to increase audits of business aircraft usage, which could be costly and disruptive for affected companies. A letter from six senators supported the IRS audit initiative and requested an increase in the rate at which income is imputed to executives for their personal flights on company aircraft. President Joe Biden’s budget proposes lengthening the depreciation life of business aircraft and increasing the fuel tax rate on jet fuel used by business aircraft, both of which would increase taxes with respect to business aircraft.