November 7, 2019
Ottawa Proposes Excise Tax on Aircraft Sales
With the federal election now over and Prime Minister Trudeau laying out the priorities for the new minority government, one of his party’s key commitments has aircraft owners across Canada concerned. The Liberal Party announced, as part of their election platform, a new ‘Luxury Tax’ to be levied on certain vehicles valued at or more than $100,000. Among the list of affected vehicles are privately registered aircraft.
The plan, costed by the Parliamentary Budget Officer (PBO), was vague on additional details. The PBO estimated, with “high uncertainty” that revenues from the new tax could reach as high as $600 million in the near term. Though not specified, the wording of the announcement implied the tax would be levied on the whole amount, not simply the portion at and over $100,000. Similarly unclear is whether the tax would apply to any aircraft, or only to new aircraft. The proposed tax would also apply to boats and cars of similar value. Being an excise tax, it would in turn likely be subject to GST or HST where applicable, and possibly provincial sales tax too.
“COPA, along with other aviation industry groups, has serious concerns over the impact that such a measure could have on the future of General Aviation in Canada,” said Bernard Gervais, COPA’s president and CEO. “While the idea is, at the moment, a simple campaign promise, members can be assured that their association will be front and centre advocating against any such measures that might be proposed in legislation.”
Implementing the proposed tax would require legislation to be approved by Parliament, which cannot be tabled until the House resumes sitting following last month’s general election. In the meantime, COPA invites concerned members to contact their Member of Parliament. We have included a template letter below for members’ use. We encourage anyone writing to his or her MP to copy us at email@example.com.
Contact details for MPs can be found on the Parliament of Canada website. Email addresses for MPs are generally formatted as FirstName.Lastname@parl.gc.ca.
If you are unsure about which riding you live in, you can search by postal code on Elections Canada’s website.