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Private jets are usually not owned by companies e.G. in the EU, but by a shell company in another jurisdiction. They are most often not owned (directly) by the

Private jets are usually not owned by companies e.G. in the EU, but by a shell company in another jurisdiction. They are most often not owned (directly) by the people who use them, but by shell companies (for tax evasion reasons, e.G. VAT evasion) that those people control over a chain of ownerships. Same for yachts, apartments in NYC or London etc. Rich people don't own stuff (directly).

wnc3141 3y ago
I used to work in the industry. My understanding is that the vast majority of private jets (not including general aviation) is owned by or managed by firms that charter out their jet. (Like a taxi business). Of course there's nuance between those business models.
- KingOfCoders 3y ago
  Yes kind of, but the leasing companies have only one customer, see "Lewis Hamilton avoided taxes on £16.5m jet using Isle of Man scheme The big four accountancy firm EY and Appleby [..] helped Hamilton and dozens of other clients set up seemingly artificial leasing businesses through which they rented their own jets from themselves." https://www.theguardian.com/news/2017/nov/06/lewis-hamilton-avoided-taxes-jet-isle-of-man-scheme-paradise-papers https://www.theguardian.com/news/2017/nov/06/lewis-hamilton-...
kelnos 3y ago
So what? The proposal is a tax on fuel. That tax is paid where the fuel is bought, as a portion of its direct cost. You can't "hide" that.
- KingOfCoders 3y ago
  "private jet fuel" It's not private, it's a company jet. So how to you distinguish this jet from a commercial airliner? The company is smaller than United? The larger jets of United pay the lower tax? So United can no longer own small jets? This will lead to people buying larger jets, if needed they will buy A220. The effect being that more CO2 is produced. High tax if you don't sell tickets? Then the shell companies will sell tickets for the flights to the people who use the jet and own the shell company. Or smaller jets get larger tanks and go to Mexico or the Bahamas, then fly back to the US. Politicians are the worst people in second order thinking. Other explanation is they are populist and don't care if the stuff they do works. (Will need to read the bill, the article is sparse on facts) [Edit] Read the bill. It is sparse on implementation, it only says "commercial" has lower taxes, (going back to the 2017 with a hypothetical example) well Hamilton buying a ticket from the Notlimah Ltd. Airline of Panama enables the Notlimah Airline company to pay lower taxes. How is this working? Other people need to be able to buy tickets for the company to be called commercial? His friends buy tickets. Other people beside his friends need to be able to buy (how to enforce this?)? Ok, everyone with a coupon card can buy. Or: The airline changes it's terms of service to everyone with a net income of >$10M/y is allowed to buy a ticket. Or a ticket costs $1M flight, H. pays N. Airline, then the money gets back to H. to a bank account on the Bahamas. I really would like to know how to enforce this. Beside this 1 line of how it should be applied, it has pages and pages on who should get the money, one list (A) Black (B) African American (C) Asia (D) Pacific Islander (E) Other non-White race (F) Hispanic (G) Latino (H) Linguistically isolated (I) Middle Eastern and North African. and another e.G. (A) a Federally recognized Indian Tribe (B) a State-recognized Indian Tribe (C) an Alaska Native community (D) a Native Hawaiian community (E) any other Indigenous community So very low effort in the bill on how to get the money, a lot of effort in the bill on how to spread the money. And this is the trick, rich leftist politicians do: Proposing anti-rich laws that do not hurt their rich friends at all and being hurrayed by their naive voters, instead of doing things that hurt their rich friends.
  - AnimalMuppet 3y ago
    I don't think there are many people who fly enough that it's economical for them to buy an A220 in order to save $1.73/gal on jet fuel. (That's the actual proposed change in taxes.)
    - KingOfCoders 3y ago
      The title of the article was "Why not tax private jets out of business?" The smallest plane United operates is a "EMB 145" which should be in reach for many of these people (Google search says "$2,395,000" - which is cheaper than many Gulfstreams)

wnc3141 3y ago

I used to work in the industry. My understanding is that the vast majority of private jets (not including general aviation) is owned by or managed by firms that charter out their jet. (Like a taxi business). Of course there's nuance between those business models.

KingOfCoders 3y ago
Yes kind of, but the leasing companies have only one customer, see "Lewis Hamilton avoided taxes on £16.5m jet using Isle of Man scheme The big four accountancy firm EY and Appleby [..] helped Hamilton and dozens of other clients set up seemingly artificial leasing businesses through which they rented their own jets from themselves." https://www.theguardian.com/news/2017/nov/06/lewis-hamilton-avoided-taxes-jet-isle-of-man-scheme-paradise-papers https://www.theguardian.com/news/2017/nov/06/lewis-hamilton-...

kelnos 3y ago

So what? The proposal is a tax on fuel. That tax is paid where the fuel is bought, as a portion of its direct cost. You can't "hide" that.

KingOfCoders 3y ago
"private jet fuel" It's not private, it's a company jet. So how to you distinguish this jet from a commercial airliner? The company is smaller than United? The larger jets of United pay the lower tax? So United can no longer own small jets? This will lead to people buying larger jets, if needed they will buy A220. The effect being that more CO2 is produced. High tax if you don't sell tickets? Then the shell companies will sell tickets for the flights to the people who use the jet and own the shell company. Or smaller jets get larger tanks and go to Mexico or the Bahamas, then fly back to the US. Politicians are the worst people in second order thinking. Other explanation is they are populist and don't care if the stuff they do works. (Will need to read the bill, the article is sparse on facts) [Edit] Read the bill. It is sparse on implementation, it only says "commercial" has lower taxes, (going back to the 2017 with a hypothetical example) well Hamilton buying a ticket from the Notlimah Ltd. Airline of Panama enables the Notlimah Airline company to pay lower taxes. How is this working? Other people need to be able to buy tickets for the company to be called commercial? His friends buy tickets. Other people beside his friends need to be able to buy (how to enforce this?)? Ok, everyone with a coupon card can buy. Or: The airline changes it's terms of service to everyone with a net income of >$10M/y is allowed to buy a ticket. Or a ticket costs $1M flight, H. pays N. Airline, then the money gets back to H. to a bank account on the Bahamas. I really would like to know how to enforce this. Beside this 1 line of how it should be applied, it has pages and pages on who should get the money, one list (A) Black (B) African American (C) Asia (D) Pacific Islander (E) Other non-White race (F) Hispanic (G) Latino (H) Linguistically isolated (I) Middle Eastern and North African. and another e.G. (A) a Federally recognized Indian Tribe (B) a State-recognized Indian Tribe (C) an Alaska Native community (D) a Native Hawaiian community (E) any other Indigenous community So very low effort in the bill on how to get the money, a lot of effort in the bill on how to spread the money. And this is the trick, rich leftist politicians do: Proposing anti-rich laws that do not hurt their rich friends at all and being hurrayed by their naive voters, instead of doing things that hurt their rich friends.
- AnimalMuppet 3y ago
  I don't think there are many people who fly enough that it's economical for them to buy an A220 in order to save $1.73/gal on jet fuel. (That's the actual proposed change in taxes.)
  - KingOfCoders 3y ago
    The title of the article was "Why not tax private jets out of business?" The smallest plane United operates is a "EMB 145" which should be in reach for many of these people (Google search says "$2,395,000" - which is cheaper than many Gulfstreams)