COPA president and CEO Kevin Psutka has sent an appeal to Paul Ramsey, Minister of Finance and Corporate Relations for British Columbia. The letter requests that his government consider the unfairness of the present tax system regarding hangars in B.C. A similar letter is being drafted for Manitoba.
Dear Minister Ramsey:
Regarding: Taxation of aircraft hangars storing privately-owned aircraft
The Canadian Owners and Pilots Association represents the interests of citizens who fly private aircraft for personal travel and recreation. We have recently been successful in reversing a change to the taxation of hangars in Ontario and I would like to highlight both the problem and the solution to you, as I believe that the same problem exists in your province and I urge you to address the unfair regulation.
In 1998, the Ontario government attempted to simplify the property tax structure by reducing the number of classes of property. However, they introduced a provision whereby property that did not clearly fit into one of the non-commercial classes automatically defaulted to commercial. Although many hangars used to store privately-registered aircraft are in fact no different than a garage used to store a private car, they did not clearly fit into one of the non-commercial classes, even though they were treated as non-commercial before 1998.
I have attached a copy of our presentation to the Ontario Finance Minister, which explains in detail why privately-registered aircraft cannot be used commercially. I have also attached a response from the Minister’s office in agreement with COPA’s position that it is unfair to tax hangars at a commercial rate. Also, I have included the wording for the recent addition to the regulation that introduces a specific sub-paragraph to classify hangars used to store private aircraft, and the land on which they sit, as residential/farm for tax rate purposes.
I have also attached the text of letter from Mr. Chester Glendenning on behalf of hangar owners at Langley, B.C. Airport, to illustrate the problem in BC. These hangar owners have appealed their business assessment but have been told that there is nothing that the Appeal Board can do in light of existing regulations. This is exactly the same problem faced in Ontario, where although the Review Board agreed on several occasions that commercial tax rates may not be appropriate, their hands were tied by existing regulations. Their recommendation was to change the regulation, which we have now done.
I am appealing to you to give this your attention. Private aviation has become increasingly expensive and yet it remains important for generating jobs for aspiring airline pilots, who train private pilots, maintainers who gain experience on these aircraft on their way to airline jobs, and most importantly as a transportation source to link our vast regions of Canada together. You can do your part to support this important sector of aviation by amending your regulations to treat hangars used to house private aircraft, and the land on which they sit, as non-commercial.
I am available at your convenience to explain our concerns and to help you develop the words that would correct the inequity. In addition, our Provincial Director, Ken Armstrong, lives in the Victoria area and is readily available to work with your staff.
Yours truly, Kevin Psutka, COPA President and CEO.