Oct. 5, 2009
Move to lure Sikorsky helicopter business

The following information was released by Pennsylvania House of Representatives, Democratic Caucus:

The state House approved legislation Friday that would exempt helicopter sales and repairs from the state sales and use tax, a measure proposed and advocated by Rep. Tom Houghton, D-Chester.

The House approved an amended version of H.B. 1531, which included the measure Houghton fought for to exempt helicopter sales, repairs and maintenance from the sales tax. House Bill 1531 also included various other tax code provisions related to the pending 2009-10 state budget.

"We have an immediate opportunity to bring hundreds of good-paying jobs to our area simply by exempting helicopter sales and repairs from the sales tax," Houghton said. "One of our area's largest employers, Sikorski Global Helicopters - parent company of Keystone Helicopter -- wants to move its entire business and 300 jobs to Sadsbury, but Pennsylvania's sales tax is a major discouraging factor in its decision."

Houghton pointed out that Pennsylvania is at a competitive disadvantage being one of the only Northeastern states that taxes aviation sales. Businesses see neighboring states such as Delaware as more cost-effective locations for helicopter sales and maintenance.

The lawmaker said the benefits of the exemption would far outweigh the loss in sales tax revenue to the state.

"This exemption would cost the state $72,000 in lost tax revenue from helicopter sales because companies avoid selling their product here due to our sales tax," Houghton said. "Compare that minimal cost to $500,000 in Personal Income Taxes the state would receive just from the 300 jobs that could come to Sadsbury in my legislative district. Then compare that $72,000 to the countless other jobs that could be created or even saved by implementing this exemption. It is a commonsense move."

Besides Sadsbury, Houghton said the exemption would have the potential to generate countless industry jobs and various spinoff jobs across the state. For example, he pointed out that recent changes in U.S. Department of Defense policies may hurt Boeing Helicopter's facility near Philadelphia by exposing the company's foreign sales to Pennsylvania's sales tax. That change may compel the company to move its point of sale to Delaware, where aviation sales are tax exempt.

House Bill 1531 as amended now awaits consideration by the state Senate. For more information, please contact Houghton's office at 610-593-6565 or by visiting his Web site: