Dear Aviation Business Professional:
Today, the National Air Transportation Association (NATA) announced the launch of a new initiative called “General Aviation Advancing America.” At cities throughout the U.S., NATA leadership will join in and facilitate focus groups consisting of essential community and aviation stakeholders to discuss how rural airports serve as a runway for economic development, job recovery, and emergency response. General Aviation Advancing America is designed to encourage open dialogue among key participants on how general aviation stakeholders facilitate the success of the community. Another goal of these gatherings is to generate ideas on how general aviation businesses and general aviation airports can work together to demonstrate and communicate the significant, meaningful contributions of the airport and its tenant businesses during this time of challenge and change. Visit www.fly.nata.aero/GeneralAviationAdvancingAmerica to register for an upcoming event or reach out to NATA SVP Ryan Waguespack at firstname.lastname@example.org if you would like to host an upcoming General Aviation Advancing America gathering at your airport.
NATA Works to Clarify Recently Published Federal Excise Tax Proposed Rules
NATA and our industry partners worked for several years to maintain the historical non-taxable status of traditional aircraft management services. This culminated in the passage of legislation in 2017 affirmatively stating that amounts paid by aircraft owners for aircraft management services are not subject to the commercial FET.
In May 2018, we asked the IRS to address certain topics related to application of the exemption that needed clarity. Last Friday, the IRS published an NPRM addressing the exemption from commercial FET for aircraft management services. Comments on the rule are accepted through September 29, 2020.
In our review of the proposal, several helpful clarifications are provided. The IRS explains that:
- Owners choosing to have their personal flights operated under Part 135 still qualify for the exemption
- The exemption still applies if owners allow their aircraft to be used for third-party charters (the commercial FET of course still applies to the amounts paid by the charterer)
- The method or manner of billing an owner does not impact applicability of the exemption
- If the exemption applies, the “Possession, Command and Control” test does not
NATA is actively participating in discussions with the IRS, where we hope to address the following areas to ensure operators providing management services are given clear direction and to which we may propose changes in our comments, including:
- IRS limits who an “aircraft owner” is, restricting the ability for related parties to make payments for services on the owner’s behalf. These limits may cause concerns for the management company because they will need to have clarity on who is paying in order to know if the taxes should be assessed.
- IRS includes a provision that carriers have primary liability for payment of taxes. This would mean that if the IRS determines a tax was due and the carrier failed to collect and remit it that the carrier is liable for those amounts.
The NRPM also includes several provisions to remove obsolete regulations and update rules to reflect current law.
Members are encouraged to obtain and review the NRPM. To provide members the latest insight and analysis, NATA’s FET FAQs | Ask the Experts Webinar will now take place on a new date next week. Join us on Wednesday, August 12, 2020, at 1:00 p.m. EDT for a review of the current FET holiday and updated information on the NRPM. We thank Priester Aviation for their sponsorship of this webinar.
NATA’s regulatory team remains engaged with the agencies to address the unique needs of our membership with an important recent development in crew member extensions that NATA requested on behalf of our members.
- Last Thursday, the FAA granted NATA’s request for an extension to exemptions regarding certain crew training and checking requirements. NATA’s continued engagement with the FAA is crucial as the lifting of restrictions remains fluid and we move toward a gradual return to operations. NATA and its members applaud the efforts of the FAA for addressing the needs of the industry. This collaboration ensures air transportation availability and continued aviation safety. The two exemptions, available to all Part 119 certificated carriers operating under Part 135, were initially granted to NATA in late March and were previously extended in May. The new extension for Exemption No. 18509B extends the date until November 30, 2020, and Exemption No. 18510B extends the date to December 31, 2020.
- NATA continues to be engaged with TSA in regular meetings of the Insider Threat Subcommittee of the Aviation Security Advisory Council (ASAC). The subcommittee is monitoring TSA progress in implementing the original 21 recommendations developed and submitted to TSA on mitigating various aspects of security threats posed by “insiders.” The subcommittee meets regularly to continue developing recommendations and best practices to mitigate additional threats.
- NATA staff and members are part of an industry group participating in discussions with TSA to identify ways Standard Security Programs can be most effectively implemented in charter operations. The group is highlighting key operational differences in the operation of purpose-built business aircraft compared to Part 121 air carriers and how those differences can be best accommodated to ensure compliance with security programs.
- The US Department of Homeland Security (DHS) recently communicated a reminder for operators that international travel restrictions are still in place as part of the COVID-19 response efforts. Specifically, Americans returning to the US after visiting China, Iran, the United Kingdom, Ireland, Brazil, and countries in the Schengen area within 14 days of arrival in the US must use one of the fifteen designated “funneling airports” as the first point of arrival in the US. Those airports are JFK, ORD, SFO, SEA, HNL, LAX, ATL, IAD, EWR, DFW, DTW, BOS, MIA, FLL, and IAH. If the flight is NOT arriving from a restricted country, they may land at any port of entry unless there are passengers on board with nexus to any of the restricted countries in the past 14 days.
Aviation Business Journal – Summer Issue Provides Operational Guidance in a Changing Environment
We are pleased to release the Summer edition of the Aviation Business Journal (ABJ). This issue is full of important advice and information to assist our members in navigating the current climate, adapting to changes in the business environment, and pushing through recovery. Highlights of the Summer ABJ include, Atlantic Aviation’s quick action plan for confronting COVID-19, Ross Aviation’s guidance for international operations in a pandemic, the team at NATACS’ insight into insider threats, Dr. Goodheart’s discussion of safety performance measures, MySky’s Jean de Looz covers steps for successful aircraft management, and AirDocs provides critical information on recognizing the symptoms of hypoxia. In addition, NATA provides guidance on how to safety span the distance with the inclusion of our popular Safety 1st Clean standard, insight from Chairman Curt Castagna on working together to make meaningful change, direct access to the NFPA 409 Fire Marshal Toolkit, and expert advice from Jonathon Freye on communicating with the press.
With General Aviation Advancing America, NATA is seizing a unique opportunity to showcase the immense value airports and general aviation businesses contribute to their regions. Without your crucial businesses, the essential roles that general aviation fulfills will cease, leaving a serious void in disaster relief capabilities and diminishing the support of growth and prosperity in many cities. NATA has existed for 80 years in service to aviation businesses and we’ve elevated our efforts on all fronts to continue advancing your business no matter what the climate or circumstance. Please contact NATA at email@example.com if we can be of assistance.
President & CEO
National Air Transportation Association