| Since its inception in 1973 UK VAT law has stipulated | | | | such aircraft are almost invariably below the weight |
| that "qualifying aircraft", those over 8,000kg max take | | | | threshold anyway. |
| off mass, are exempt from VAT for the purpose of | | | | It is estimated that business aviation contributes some |
| acquisition, management and operating costs. This | | | | £3.5 billion to the UK economy annually and provides |
| exemption has been enjoyed by private owners and | | | | approximately 50,000 jobs either directly or indirectly. In |
| commercial operators alike. | | | | such economic conditions as we currently endure it is |
| A recent EC decision states that this threshold for | | | | a shame that such far reaching edicts are put out with |
| exemption is no longer acceptable and while the UK | | | | seemingly little regard for their true impact and for all |
| authorities response is still not yet clearly defined it is | | | | the world to have apparently come from a base of, |
| certainly a cause for thought if not concern for all | | | | shall we say, "reduced awareness". Dave Edwards of |
| those possible affected by it. For private owners who | | | | a leading UK operator phrases it thus: " ...To implement |
| partly use their aircraft for private travel it would no | | | | this change in such a rapid manner, with virtually no |
| longer be possible to reclaim VAT on a proportion of | | | | industry discussion, opinion or debate would be, frankly, |
| the overall costs. Commercial operators will no doubt | | | | ill-considered at this time." Will Curtis of Rizon is |
| be able to reclaim the Sales Tax or equivalent on | | | | somewhat more outspoken; "This is typical of the way |
| costs but will nevertheless be faced with serious cash | | | | that the EU legislates - from a position of |
| flow issues. | | | | comprehensive ignorance and without consultation of |
| On the up side there is potential for private operators | | | | any description." |
| to pass their aircraft over to commercial operators for | | | | Whatever your stance on the subject it is an area to |
| use on their fleets. This will further increase the already | | | | keep a close eye on. Fortunately charter clients are |
| wide range of aircraft available to passengers making | | | | relatively insulated from its effects and will continue to |
| use of private jet charters. It is unlikely to impact the | | | | be free to use business charter flights as and when |
| helicopter charter and air taxi section of the industry as | | | | they are seen to be cost effective. |