Industry Groups Call On President Obama To Sign The Bill
On December 16th, the Senate approved H.R. 5771, the “Tax Increase Prevention Act of 2014.” The legislation extends for one year, retroactive to January 1st, over 50 tax provisions including accelerated (bonus) depreciation and section 179 expensing.
The House of Representatives passed the “tax extender” bill earlier this month. Now, with Senate approval, it needs President Obama’s signature to become law.
Accelerated depreciation allows businesses to take a first-year deduction equal to 50 percent of a qualified asset’s cost basis. The tax extender bill also would renew the increased limitations for Section 179 expensing, allowing businesses to expense, rather than depreciate, assets such as aircraft parts.
"NATA thanks the Senate for extending bonus depreciation and section 179 expensing for 2014. Provisions like these make a difference," said NATA president and CEO Thomas L. Hendricks in a statement. "Recently, a member company related to me how bonus depreciation resulted in the purchase of aircraft which in turn led to the hiring of additional pilots and support staff.
"We greatly appreciate the efforts that were made by Majority Leader Reid, Minority Leader McConnell, Finance Committee Chairman and Ranking Members Wyden and Hatch to extend these investment and job creating provisions on a longer basis. We look forward to working with Congress next year to extend the time period for these provisions in order to achieve the maximum impact they bring to investment and job creation.”
“NBAA welcomes this vote by the Senate and commends members of both parties for working together to renew tax policies such as accelerated depreciation,” read a statement from NBAA President and CEO Ed Bolen. “We urge President Obama to sign this bipartisan bill as soon as possible.”
“The tax policies in this bill strengthen American competitiveness and preserve jobs by giving businesses immediate access to the most advanced equipment and encouraging investment in assets such as aircraft,” said Bolen.
The bill also included tax provisions that promote research and development (R&D), which were welcomed by GAMA. The report language that accompanied the appropriations bill requires the FAA to account for its efforts to expand the use of delegated authority and take a risk-based systems safety approach to oversight. It also seeks to boost the FAA’s workforce skills and training, and ensures the agency engages with international aviation authorities on aircraft certification issues. Furthermore, the bill calls for the FAA to advance implementation of the Small Airplane Revitalization Act (SARA), significantly noting that “the completion of the final rule advances safety.”
Additionally, the bill provides $6 million in funding for the Piston Aviation Fuels Initiative, a joint industry-government effort that is facilitating the safety assessment and deployment of a new unleaded avgas. This funding level is $300,000 above President Obama’s request for the 2015 Fiscal Year, and will be used to evaluate and support fleet-wide approval of unleaded candidate fuels to replace the 100 octane low-lead fuel currently used by piston-engine aircraft.
“We are very pleased that Congress continues to recognize the importance of the R&D tax credit and bonus depreciation, which will have a positive impact on general aviation manufacturers for their end-of-year sales in 2014,” GAMA President and CEO Pete Bunce said. “GAMA is also gratified that Congress is keeping up the pressure on both the FAA and industry to develop more efficient regulatory processes, which will allow manufacturers to bring new products that enhance safety to market much more quickly while the FAA makes more efficient use of its engineering resources. Certification streamlining initiatives and the Small Airplane Revitalization Act are important pieces of these efforts, and Congress has been very supportive in this area.
“Furthermore, GAMA appreciates the funding endorsement from Congress as we work toward fielding an unleaded avgas,” Bunce continued. “As we introduce this new type of fuel, it’s vital that we keep our piston aircraft flying safely, reduce the economic impact on our industry, and improve the environment.
While bonus depreciation expired at the end of 2013, a broad coalition of industry groups including NBAA and NATA have backed efforts in Congress to renew it and other tax extenders retroactively and in time for the 2014 tax-filing season.
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