Folks here in Cambridge were euphoric when the hated Mitt Romney was replaced as governor by Deval Patrick, who, like Barack Obama and Cory Booker, falls into the young, gifted, and black category. After a year in office, nobody can point to any concrete achievement by Patrick, who has been in the news mostly for use of the state police helicopter, extravagant spending on redecoration, married gay teenage sex, and advocacy of casinos in Massachusetts.
Now it seems that Patrick is trying to revive the sales tax on aircraft and aircraft maintenance (story). The tax was repealed in 2002 in an effort by a Republican state legislator, Cele Hahn, to make Massachusetts competitive with surrounding aviation tax-free states such as New Hampshire and Connecticut. Companies that had a choice would base their airplane, along with its hangar and maintenance jobs, in a nearby state in order to save $millions in taxes on an expensive plane. Ms. Hahn’s plan has been largely successful.
Maybe “young, gifted, and black” translates to “try to tax things that can move at 500 mph; send jobs to states governed by old, boring, and white people (example).”
[According to www.celehahn.org, Ms. Hahn is no longer a taxpayer here in the Commonwealth. She moved to New Hampshire.]
Not hard to understand, considering that Deval, if you read his bio, has never worked at a real private sector job in his life. He only joined a private law firm after making his connections, which means he was hired for the connections he had.
Unfortunately the same goes for Barack Obama – no actual exposure to the dirty grimy world. Another failed Democratic candidate with a similar bio is Joe Lieberman who went straight from grad school into politics.
It’s not just one ethnic group levying such taxes. Other people are doing that too: http://pressherald.mainetoday.com/story.php?id=167987&ac=PHnws
You might get a bill for several $10,000s, or even over $100k if you fly your plane into Maine for more than 20 days in a year, even if you live in Massachusetts. I’m guessing that other states have this too, so there may be no way around it, right?
Steve: The Maine law exempts expensive airplanes and airplanes used in Part 135 charter operations, so the way around it to base the airplane in a state with no aircraft sales tax (Connecticut, Massachusetts, or New Hampshire) and, if there is a need to travel to Maine frequently, put the airplane into an LLC that does charter operations (or avoid Maine for the plane’s first year).
There are a few other very aggressive states, e.g., California (see http://www.aeromarinetaxpros.com/long-arm-of-boe.htm ). I guess this is a serious enough problem that it creates demand for lawyers, which is probably not conducive to economic growth (the Chinese build factories; we set up elaborate paperwork fights amongst ourselves).
This is how it goes, and how it will go. Our decline as a country is and will be marked by a series of attacks on pockets of wealth. Not enough so that any one instance is enough to rile sufficient quantities of people for our democracy to care about it. The prediction of Bastiat is coming true, and the treasury is being raided by the majority. Overtaxing rich guys with airplanes to pay for the healthcare of welfare mothers is a pretty classic failure mode of a democracy. (Don’t forget that the reason Patrick is doing this is because our wonderful healthcare for everybody initiative is *gasp* costing more than they thought it would.)
So, Phil, given how much you (rightfully) complain about Cambridge and MA, why are you not living in NH?
JB: New Hampshire is not quite the rich bastard’s paradise that it seems on the surface. There is no income tax for wage slaves, but NH taxes dividends and interest. Wyoming, Florida, Alaska, Nevada, etc. are the true rich bastards’ paradise.
Anyway, I’m not arguing that aviation shouldn’t be taxed. There is already a fat federal excise tax on charter services. There are federal and state taxes (I think) on aviation fuel. For a geographically tiny state to say “we’re also going to clean up by heaping on sales tax” is just a way of destroying jobs; they aren’t going to collect significant revenue from this unless you assume that Massachusetts residents are idiots. In a jet, it is literally a two-minute flight from the Nashua airport to the Massachusetts border. Every jet probably generates at least 10 jobs (pilots, mechanics, dispatchers, cleaners, hangar construction).