July 1, 2011 By Kristina Peterson
WASHINGTON -(Dow Jones)- Defending tax breaks for corporate jet owners can be a delicate business.
Republican lawmakers on Thursday largely opted to criticize the scope of a proposal to end special tax breaks for companies that use corporate jets, which they said would barely dent the government’s gaping budget deficit.
A gutsier line of defense came from JetSuite Chief Executive Alex Wilcox, who took the bold stance Thursday that not all corporate-jet habitues are uber- wealthy villains traipsing to a golf course.
“It’s a very easy target,” Wilcox said of the industry in an interview Thursday. “Some fat cat flying 500 miles to his country club: that’s the exception, not the rule.”
JetSuite’s passengers may not even make that much income, he said, and will be able to afford the flights even if they lose their tax breaks. JetSuite sells its unused legs on Facebook every night for $499 for up to four people.
“We’re going to fly the flight anyway, so we might as well make it available to the public,” said Wilcox, who helped found JetBlue Airways. “That typifies our more populist approach.” Other flights booked in advance are more expensive, though the company’s 11 planes fly more hours than the industry average to keep prices lower.
But JetSuite itself may be the exception to the rule. Most private jet passengers are “very, very affluent,” Wilcox said, though some passengers are employees of large companies flying to hard-to-reach destinations that aren’t viable for commercial airlines.
Democrats Thursday scoffed at any possible defense of corporate-jet tax breaks, one day after President Barack Obama pressed to close the budget deficit by rescinding special breaks for the wealthiest taxpayers.
“If everybody else is willing to take on their sacred cows and do tough things in order to achieve the goal of real deficit reduction, then I think it would be hard for the Republicans to stand there and say that the tax break for corporate jets is sufficiently important that we’re not willing to come to the table and get a deal done,” the president said at a press conference Wednesday.
The suggested proposal would change the depreciation schedule for corporate jets to seven years from five years, aligning them with the rules for commercial airplanes. The switch is expected to bring in roughly $3 billion in revenue over 10 years.
http://www.nasdaq.com/aspx/stock-market-news-story.aspx?storyid=201106301755dowjonesdjonline000688&title=republicansjet-industry-delicately-defend-tax-breaks
Source: DOW JONES NEWSWIRES
Date: 2011-07-01