West Star more competitive with a sales tax exemption
It may mean fewer sales tax dollars. But the benefit to the local business economy will be worth exempting aircraft parts installed in Grand Junction from sales tax, according to Grand Junction City Councilman Gregg Palmer.
Council members approved the exemption Monday evening for all items installed permanently on or in aircraft, including seats, engine parts, and other items. Mesa County and the state of Colorado already exempt installed aircraft parts from sales tax.
“It will definitely cost the city money,” Palmer said. “In this case, we’ll reap far more in benefits than we’ll lose.”
West Star Aviation Vice President of Sales Rick Brainard said the exemption should help make the company competitive for international business. When searching for a business to work with, Brainard said clients often make their choice based on whether the business is located in a place that imposes sales tax on aircraft parts. One of West Star’s biggest competitors has facilities in Nebraska and Utah, both states that don’t have sales tax on installed airplane parts.
“We have people in our backyard with a competitive advantage,” Brainard said.
That won’t be the case 29 days from now, when Grand Junction removes installed aircraft parts from the list of items subject to city sales tax.
Brainard said West Star inquired about a sales tax exemption because clients had more choice in where to fly to have work done on a plane.
The company is not interested in asking for exemptions on items such as over-the-counter parts sales, he said, because those clients are likely located in and will buy in Grand Junction anyway.