West Virginia Enacts Exemption for Repair, Remodeling and Maintenance Services for Certain Aircraft

Effective for sales made on or after September 1, 2018, West Virginia has enacted an exemption from the state’s consumer sales and service tax for the following:

• Sales of aircraft repair, remodeling and maintenance services when the services are to an aircraft operated under a fractional ownership program, or to an engine or other component part of an aircraft operated under a fractional ownership program;
• Sales of tangible personal property that is permanently affixed or permanently attached as a component part of an aircraft operated under a fractional ownership program, as part of the repair, remodeling or maintenance service; and
• Sales of machinery, tools or equipment directly used or consumed exclusively in the repair, remodeling or maintenance of aircraft, aircraft engines or aircraft component parts for an aircraft operated under a fractional ownership program.

For purposes of the exemption, “fractional ownership program” means any system of aircraft ownership and exchange that consists of all of the following:

• The provision for fractional ownership program management services by a single fractional ownership program manager on behalf of the fractional owners;
• Two or more airworthy aircraft;
• One or more fractional owners per program aircraft, with at least one program aircraft having more than one owner;
• Possession of at least a minimum fractional ownership interest in one or more program aircraft by each fractional owner;
• A dry-lease aircraft exchange arrangement among all of the fractional owners; and
• Multi-year program agreements covering the fractional ownership, fractional ownership program management services, and dry-lease aircraft exchange aspects of the program.

Unless the purchaser holds a direct pay certificate or has applied to the Tax Commissioner for permission to use an exemption certificate, the purchaser shall pay the tax to the vendor and then file for a refund or credit with the Tax Commissioner. (H.B. 4022, Laws 2018, effective September 1, 2018)