By Linda Loyd
President Obama’s message to jet-setters: Pay your fair share.
The president ruffled some high-flying feathers when he said that the United States should end tax breaks for the owners of corporate jets during Wednesday night’s debate with Mitt Romney.
“My attitude is, if you got a corporate jet, you can probably afford to pay full freight, not get a special break for it,” he said, discussing ways to reduce the federal deficit.
Obama was referring to the accelerated depreciation of business jets. A national business aviation trade group, which represents owners of private jets, called Obama’s comments “misleading.”
“The president’s comments completely mischaracterized the businesses and groups that depend on an airplane, the majority of which are small- to mid-sized businesses, farms, flight schools, medical-care providers, and emergency responders, which use the aircraft to connect communities and grow their businesses,” said Ed Bolen, president and CEO of the National Business Aviation Association.
Under current law, companies that use jets for business purposes can depreciate taxes on corporate jets over five years, as opposed to the seven years allowed for commercial and charter airlines.
Obama and Democrats in Congress say that eliminating a tax break for purchasing business jets, and bringing the corporate-jet depreciation schedule in line with that of other airliners, would bring in $3 billion over 10 years.
Republicans and the business-aviation lobby say the accelerated depreciation promotes aircraft sales, which helps corporate jet manufacturers and adds jobs.
“At a time when both candidates claim to be putting job creation at the top of their agenda, it’s unfortunate that the president tonight denigrated business aviation, which is the manufacture and use of a small airplane for business reasons – an industry responsible for 1.2 million American jobs and $150 billion in economic impact,” Bolen said.
Business jets often fly into towns with little or no airline service, and “businesses are using their aircraft to create opportunities that will help keep them competitive in a still-challenging economic environment,” Bolen said.
Obama said oil companies should also pay more in taxes.
“The oil industry gets $4 billion a year in corporate welfare. Basically, they get deductions that those small businesses that Gov. Romney refers to don’t get,” Obama said.
“Now, does anybody think that ExxonMobil needs some extra money when they’re making money every time you go to the pump? Why wouldn’t we want to eliminate that? Why wouldn’t we eliminate tax breaks for corporate jets?”