Virginia Sales Tax Exemptions for Aircraft in Effect
Posted on 06.06.18
By Terry Barrett, CPA | Tax Senior Manager | State and Local Tax Industry Team
Starting July 1, 2018, there will be an exemption from Virginia’s Retail Sales and Use Tax for parts, engines, and supplies used for maintaining, repairing, or reconditioning aircraft or any aircraft’s avionics system, engine, or component parts. The exemption is for both manned and unmanned (e.g., drone) systems. The exemption, however, does not extend to tools or equipment used in the maintenance or repair process. The exemption is essentially for unscheduled common carriers and owners of private aircraft and systems and has a sunset date of July 1, 2022.
Since 1966, there has been an exemption from Virginia’s Retail Sales and Use Tax for purchases by scheduled airlines. That exemption is for tangible personal property sold or leased to airlines operating in intrastate, interstate or foreign commerce as a common carrier providing scheduled air service on a continuing basis to one or more Virginia airports at least one day per week, for use or consumption by such airline directly in the rendition of its common carrier service. The existing exemption for scheduled airlines is for items used or consumed directly in the rendition of common carrier services and is broader than the new exemption.
Questions on the changes facing Virginia retail sales and use taxes? We can help. Contact a member of the State and Local Tax team or Email | 804.747.0000
Additional State and Local Tax Resources:
“Supreme Court’s Wayfair Case Will Impact Virginia Businesses”
State Efforts to Collect Sales Use Tax
State and Local Tax Obligations of Emerging Businesses
“Merging or acquiring? Don’t forget state and local taxes”
Federal Tax Reform: State and Local Implications
Tax Cuts and Jobs Act Overview
Posted by: Terry Barrett, CPA
Terry Barrett specializes in state and local tax concerns for her clients. She has over 30 years of experience working in the public and private accounting sector. She is a graduate of Virginia Commonwealth University. You can read more of Terry’s state and local tax insights here.