Aircraft repairers: Tax forces job cuts

July 17, 2007

DAYTON -- Small aircraft owners and operators say they fly their planes to nearby states for repairs to avoid an Ohio sales tax on parts and labor.

Company owners vow to continue lobbying the Ohio legislature to repeal the tax, which they say forces them to cut jobs.

They were unsuccessful in pushing for the change in the two-year state budget signed into law June 30.

"I don't want to chase jobs away," said Mark Geisler, service center general manager at Winner Aviation, based at the Youngstown- Warren Regional Airport. "And this tax is chasing jobs away."

State lawmakers balked at repealing the tax this year because it would cost the state $12 million to $15 million annually in lost tax revenue.

The cost was too much at a time when lawmakers were trying to find ways to plug a deficit resulting from a drop in tax receipts, said state Rep. Kevin DeWine, a Fairborn Republican. DeWine helped arrange an appearance by aircraft repair executives in front of a legislative subcommittee in March.

State Rep. Robert Hagan, a Youngstown Democrat, pushed for a repeal of the tax in the budget and is considering whether to file a separate bill this fall, said Gregg Paul, Hagan's legislative aide.

Aircraft repair company leaders testified in March that owners and operators are flying their planes to nearby states such as New York, Michigan and New Hampshire to avoid paying taxes of $25,000 to $40,000 on a $500,000 to $750,000 maintenance bill.

"When you get on an airplane, you have the opportunity to go anywhere for repairs," said John Bosch, president and CEO of Commander Aero, based at Dayton-Wright Brothers Airport.

Winner Aviation, which employs 55 people and has annual revenues of $10 million, had to lay off three technicians this year and two in 2006 because of work lost to competitors in states without the tax, Geisler said. The average wage for such technicians is about $35,000 a year, he said.