Aviation industry companies now have another reason to do business in Southern Nevada. Working with the LVGEA, companies may apply for tax abatements for Nevada personal property and sales and use taxes for up to 20 years.
The Nevada Legislature passed Assembly Bill 161, which was signed by Gov. Brian Sandoval June 8 and is effective immediately.
The abatement reduces the effective sales tax rate from 8.1 percent to 2 percent for aviation-related purchases and abates personal property taxes for aviation-related equipment purchases.
The new law is ideal for air tour operators and Nevada-based aviation maintenance, repair, and overhaul facilities. The law also benefits aviation companies engaged in maintenance, repair, overhaul and operation of unmanned aerial systems. (Large, commercial carriers regulated by the Federal Aviation Administration under C.F.R. Part 125 or 135 are not eligible.)
Several aviation companies are already applying to receive this tax abatement and expand their Southern Nevada operations.
· New Business: Create 5 or more full-time jobs within one year
· Existing business: increased the number of full-time Nevada employees by 3 percent or 3 employees, whichever is greater, within one year
- Business must be registered, licensed, and permitted pursuant to laws of the State of Nevada
- Business must own, operate, manufacture, service, maintain, test, repair, overhaul or assemble aircraft or aircraft components
- Comply with audit requirements contained in NRS 360.755 (audit applies to all Nevada tax abatements)
Other requirements (must meet one):
- New capital investment of at least $250,000 in Nevada within one year of receiving certificate of eligibility
- Maintain and possess in Nevada tangible personal property worth at least $5 million during the agatement period
- Average hourly wage for employees at or above the average statewide hourly wage (currently $20.XX)
- The business develops, refines, or owns a patent or other intellectual property, or has been issued a FAA certificate pursuant to 14 CFR Part 21