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Tax bill of $26,000 for flying into US state of Maine?
Anyone else read the latest story in today's AvWebFlash's email newsletter
about the Massachusetts based pilot who flew his Cirrus several times into Maine and unexpectedly received a Maine "use tax" bill of over $26,000? Must GA Pilots Stay Out Of Maine? (story about half-way down): http://www.avweb.com/eletter/archive...ll.html#196716 That's just insane. I am an Angel Flight pilot for Angel Flight Northeast and this story makes me think twice about accepting any missions into or out of the state of Maine. -- Peter |
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Tax bill of $26,000 for flying into US state of Maine?
Peter R. wrote:
Anyone else read the latest story in today's AvWebFlash's email newsletter about the Massachusetts based pilot who flew his Cirrus several times into Maine and unexpectedly received a Maine "use tax" bill of over $26,000? Must GA Pilots Stay Out Of Maine? (story about half-way down): http://www.avweb.com/eletter/archive...ll.html#196716 That's just insane. I am an Angel Flight pilot for Angel Flight Northeast and this story makes me think twice about accepting any missions into or out of the state of Maine. I read the story and it doesn't give a lot of information on what basis the state is trying to charge the tax. A Use Tax in it's normal use is one that is for items bought by a citizen of the state out of the state and brought into the state. This sounds like they are trying to charge someone just "passing through" or visiting. If that's the case it is insane. The same tax could be charged to drivers who drive their car into the state. I have a feeling that this guy parked his plane somewhere that just happened to get checked that day for residents that hadn't paid taxes and his N# got written down and a bill was sent automatically. I don't even think a tax for flying into a state from another state would be consititutional under the interstate commerce clause of the US Constitution. My bet is AOPA will have this cleared up before the week is out. |
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Tax bill of $26,000 for flying into US state of Maine?
"Gig 601XL Builder" wrDOTgiaconaATsuddenlink.net wrote in message
... My bet is AOPA will have this cleared up before the week is out. Maybe not...... It looks like this has been going on for a little while already. Maine Revenue Service Jumps On 'Use Tax' Bandwagon Against Aircraft Owners Tue, 26 Jun '07 Better Keep That Bangor Trip Down To Less Than 20 Days... Or Stay Away Altogether Is Maine following Florida down the path to becoming an unfriendly haven for pilots? Months after ANN broke the news about the Sunshine State's plans to slap a "use tax" on owners of new aircraft unfortunate enough to then be seen on airport ramps in the state, it appears tax collectors in the Pine Tree state are following suit. The Augusta Morning Sentinel reports a 2005 revision to Maine's tax policy became effective January 1, that levies taxes on new aircraft owners if their planes spend more than 20 days a year on the ground there. Like Florida's controversial tax plan, it is intended to discourage residents of the state from purchasing planes in states with lesser sales tax, then flying them back home to Maine. The tax -- up to five percent of the aircraft's purchase price -- also applies to out-of-state owners who purchased aircraft within the past 12 months, and then flew those planes to Maine, even if they don't plan to stay there. Under the plan, a recent buyer planning to fly their new Cirrus or Cessna to Maine for an extended vacation, over 20 days in length, would have to make up the difference between Maine's five-percent tax, and whatever tax they paid in the state where they actually bought the plane. The idea is to use the added revenue, which works out to roughly $2 million, to offset a slight tax cut for Maine residents. Larger aircraft -- those weighing over 6,000 pounds -- are exempt from the tax. Officials with the Maine Revenue Service are also requesting flight plan information from the FAA, so they may track which pilots have recently purchased affected aircraft... and how much time they're spending in Maine. The policy is a "short-sighted money grab," says Bill Perry, who operates Maine Instrument Flight and Maine Beechcraft at the Augusta State Airport (AUG). "If you own a plane and a summer home here, or have relatives here and you want to come and visit for month, you're not going do that," Perry said. "The state must want these people not to come here. And they won't, because they're afraid they're going to get nailed on a use tax on their airplane." Proponents of the plan say the 20-day provision gives pilots enough time to avoid the tax, which is similar to a fee in place for out-of-state residents who trailer their own boats to Maine for recreational use. "I think (lawmakers in 2005) looked hard to find a balance and looked at the number of days an individual can bring a plane here," said acting state tax assessor Jerome Gerard. "I think it's pretty reasonable when you consider that 20 days doesn't include repair time... It's not that unfriendly." The Aircraft Owners and Pilots Association says levying such fees on aircraft flying into Maine will likely convince pilots to drive there instead... or, to avoid the state entirely. "(The policy) also flies in the face of your emphasis on building a 'fair and stable business environment,'" wrote AOPA president Phil Boyer, in a letter to Gov. John Baldacci. "Please know that in the meantime, we will be advising AOPA's 410,000 members outside of Maine to forgo what might be a fairly costly trip to your state." Baldacci spokeswoman Joy Leach told the paper the governor's office is reviewing AOPA's letter. Similar legislation, that would have handed Maine pilots a tax bill for repairs to their aircraft, recently died in the final moments of the 2007 legislative session, according to AOPA |
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Tax bill of $26,000 for flying into US state of Maine?
"Gig 601XL Builder" wrDOTgiaconaATsuddenlink.net wrote:
I read the story and it doesn't give a lot of information on what basis the state is trying to charge the tax. A Use Tax in it's normal use is one that is for items bought by a citizen of the state out of the state and brought into the state. This sounds like they are trying to charge someone just "passing through" or visiting. If that's the case it is insane. The same tax could be charged to drivers who drive their car into the state. Charging a tax for items that are "passing through" would be a clear violation of the "commerce clause" (Article 1, section 8) of the U.S. constitution, which was intended to remove the power of states to place tariffs and taxes on commerce that passed through them. One example of a state that had a law that was later ruled unconstitutional based on the commerce clause is California. For years California would charge a special fee on cars bought in other states and moved into the state. Cars bought from dealers in California were not charged the fee. I remember telling my wife that I thought the fee/tax was unconstitutional when we moved to California back in the early 90's and got hit with the fee when we registered our cars there. Fortunately someone else with the time, money, and determination must have thought the same because several years later I learned that someone had taken the state to court and got the law struck down - and refunds for a lot of people like ourselves who were hit with the fee. |
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Tax bill of $26,000 for flying into US state of Maine?
On Dec 6, 8:22 am, "Gig 601XL Builder" wrDOTgiaconaATsuddenlink.net
wrote: Peter R. wrote: Anyone else read the latest story in today's AvWebFlash's email newsletter about the Massachusetts based pilot who flew his Cirrus several times into Maine and unexpectedly received a Maine "use tax" bill of over $26,000? Must GA Pilots Stay Out Of Maine? (story about half-way down): http://www.avweb.com/eletter/archive...ll.html#196716 That's just insane. I am an Angel Flight pilot for Angel Flight Northeast and this story makes me think twice about accepting any missions into or out of the state of Maine. I read the story and it doesn't give a lot of information on what basis the state is trying to charge the tax. A Use Tax in it's normal use is one that is for items bought by a citizen of the state out of the state and brought into the state. This sounds like they are trying to charge someone just "passing through" or visiting. If that's the case it is insane. The same tax could be charged to drivers who drive their car into the state. The guy is screwed. For the purpose of tax collection I believe Maine defines a citizen as someone who spends more than 20 days/year in Maine. It sounds like this guy qualifies. Personally, I believe that all use tax is unconstituational and I'd love for the courts to actually get to handle a case that is this crazy. -Robert |
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Tax bill of $26,000 for flying into US state of Maine?
Robert M. Gary wrote:
The guy is screwed. For the purpose of tax collection I believe Maine defines a citizen as someone who spends more than 20 days/year in Maine. It sounds like this guy qualifies. Personally, I believe that all use tax is unconstituational and I'd love for the courts to actually get to handle a case that is this crazy. -Robert Use tax in and of itself is perfectly understandable. Let's say I order all of my copy paper from XYZ company out of state and XYZ doesn't have a presence in the state I end up not paying sales tax that I would have paid if I went to Office Depot down the street and bought it. Hence the Use tax. But for a state to claim citizenship for anyone that spends more than 20 days in the state is stupid and shouldn't stand up in court. I live 20 miles from the Louisiana border. I spend way more than 20 days in Louisiana every year. |
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Tax bill of $26,000 for flying into US state of Maine?
On Dec 6, 11:44 am, "Gig 601XL Builder" wrDOTgiaconaATsuddenlink.net
wrote: \ Use tax in and of itself is perfectly understandable. Let's say I order all of my copy paper from XYZ company out of state and XYZ doesn't have a presence in the state I end up not paying sales tax that I would have paid if I went to Office Depot down the street and bought it. Hence the Use tax. I don't personally believe that the constitution's rule on interstate commerce allows for use tax. However, the courts have ruled that use tax is permitted under certain situations. One is that the use tax is the same as the in-state tax (sales tax), the other is timeliness, which is originally why California exempted aircraft from use tax if they are kept out of state for 3 months. -robert |
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Tax bill of $26,000 for flying into US state of Maine?
On Dec 6, 1:34 pm, "Robert M. Gary" wrote:
On Dec 6, 8:22 am, "Gig 601XL Builder" wrDOTgiaconaATsuddenlink.net wrote: Peter R. wrote: Anyone else read the latest story in today's AvWebFlash's email newsletter about the Massachusetts based pilot who flew his Cirrus several times into Maine and unexpectedly received a Maine "use tax" bill of over $26,000? Must GA Pilots Stay Out Of Maine? (story about half-way down): http://www.avweb.com/eletter/archive...ll.html#196716 That's just insane. I am an Angel Flight pilot for Angel Flight Northeast and this story makes me think twice about accepting any missions into or out of the state of Maine. I read the story and it doesn't give a lot of information on what basis the state is trying to charge the tax. A Use Tax in it's normal use is one that is for items bought by a citizen of the state out of the state and brought into the state. This sounds like they are trying to charge someone just "passing through" or visiting. If that's the case it is insane. The same tax could be charged to drivers who drive their car into the state. The guy is screwed. For the purpose of tax collection I believe Maine defines a citizen as someone who spends more than 20 days/year in Maine. It sounds like this guy qualifies. Personally, I believe that all use tax is unconstituational and I'd love for the courts to actually get to handle a case that is this crazy. -Robert- Hide quoted text - How is this possible? Both Massachusetts and Maine have 5% use tax. If he is a resident of MA, then he has already paid his sales tax to MA. Regardless of where his residency is, how could ME ask for that same tax? If he is from a state where there are no sales tax, then I could see a point to this argument. |
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Tax bill of $26,000 for flying into US state of Maine?
"Andrew Sarangan" wrote in message
... How is this possible? Both Massachusetts and Maine have 5% use tax. If he is a resident of MA, then he has already paid his sales tax to MA. Regardless of where his residency is, how could ME ask for that same tax? If he is from a state where there are no sales tax, then I could see a point to this argument. Massachusetts stopped charging sales tax on aircraft a few years ago. Maine only charges it if the plane is purchased less than 1 year ago. I paid Mass Sales Tax on mine, and have had it over a year, so they won't charge me. |
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Tax bill of $26,000 for flying into US state of Maine?
On Sun, 9 Dec 2007 23:36:34 -0800 (PST), Andrew Sarangan
wrote: How is this possible? Both Massachusetts and Maine have 5% use tax. If he is a resident of MA, then he has already paid his sales tax to MA. Regardless of where his residency is, how could ME ask for that same tax? If he is from a state where there are no sales tax, then I could see a point to this argument. MA does not have a sales tax on aircraft, they have an annual registration fee instead. Regardless, I live in MA, if I want to spend 21+ days in various locations in ME (hotel, B&B, camping, whatever) in the course of a calendar year as a tourist they expect me to pay use tax on the aircraft I use to go there? I'm reallly having a hard time seeing the legal basis. The aircraft isn't based in Maine, I don't live there, don't own property there, and I don't spend (181?) days a year there to be considered a resident by what I understand is a normal standard, so what is the legal basis for this (other than what appears to be a defective state law)? Hell, I bet someone with money and time could get it struck down under equal protection, let us know when you start sending tax bills to out of state car owners and trucking companies that log more than 20 days/year through the toll booths (on top of the registration fee they already likely charge out of state trucks). |
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