Proposed airplane tax increase has airplane owners flying away
DANVILLE, Va. (WSET) - Danville Council has cut back on its planned tax increase for airplanes, but it may not be enough.
Council had planned to triple the tax, but now they're looking at doubling it instead. A city councilman originally proposed raising the airplane property tax from .30 cents per $100 to .90 cents per $100. Councilman Lee Vogler told ABC 13, that at recent council meeting the proposal was changed to .70 cents per $100.
The new proposal would generate between $10,000 and $12,000 for the city and although the budget isn't finalized yet, some say it's just not worth it.
"It's still over doubling the current rate," Vogler said. If approved the increase would be the largest increase proposal in the budget.
"The only thing they can do is tax, but the problem with the tax is that if they raise the taxes very much, then they end up being counter productive because people end up moving the airplanes or sell the airplanes," Richard Bailey, a flight instructor for General Aviation said.
Bailey said he understands the city is trying to generate revenue, but he thinks the increase would force some of the 36 aircraft based in Danville to fly away.
"It's a matter of economics. It's just that simple. If you have a high cost of operation, then you have to do things to lower that cost," explained Bailey. "It's a very difficult thing at best to balance this and they're doing the best they can, but at the same time the same situation they're in is one the aircraft owners are in."
Bailey added that he thinks it will hurt the airport.
"Not as much fuel being sold," said Bailey. "The city gets a fuel fee off of that so every action has some very dire consequences, sometimes that are unintended."
Some, like Vogler, said there are other options. "We can lower the contingency fund by $10,000 or $15,000. We can take $10,000 or $15,000 out of the reserves."
ABC13 reached back to the councilman who proposed this tax to hear more about the benefits. We'll let you know when we hear back.