California Laws Change on Use Tax for Aircraft, Vessels & Vehicles
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California Laws Change on Use Tax for Aircraft, Vessels & Vehicles

Period of Time Buyers Must Keep Item Outside of State Reverts Back to 90 Days

Sacramento, CA: As of July 1, 2007, the laws have changed in California on use tax owed on aircraft, vessels and vehicles. Now, buyers of vehicles, vessels and aircraft generally owe California use tax when they Buy a vehicle, vessel or aircraft outside California, and Bring it into this state within 90 days.

From October, 2004 to June, 2007, use tax was generally due if the buyer brought the vehicle, vessel, or aircraft into California within 12 months of purchase. In 2004, Senate Bill 1100 temporarily amended Revenue and Taxation Code section 6248. Prior to SB 1100, 90 days outside of California had been the rule. That temporary change to 12 months expired on June 30, 2007.

Tom Alston, CEO of Aero & Marine Tax Professionals stated “In the coming weeks and months you will hear a lot of emotional rhetoric about this issue. It is a clear case of two opposing viewpoints; those who believe that tax increases targeted at their definition of the ‘rich’ will solve all the social ills in California, and those who feel their personal tax burden exceeds the value that they receive from their government. The opposing forces will be marshalling their troops to support their particular viewpoint. The groups who believe the direct targeting of vehicle, vessel and aircraft owners is the ‘right thing to do’ will be clamoring in the press for the legislature to take action, as they did in 2003 and 2004.”

“The taxpayers who believe they have been ‘unfairly targeted’ will be doing the same by contacting their legislators to defend their rights and to uphold the California Constitutional requirement of a 2/3 vote in both houses of our California Legislature. California law set up the ‘90 day exemption’ for all forms of tangible personal property decades ago. The 2004 ‘suspension’ applied only to vehicles, vessels and aircraft. This means that the 90 day exemption remained in effect for all tangible personal property while the vehicle, vessel and aircraft owners were singled out and levied a ‘tax increase’ that the rest of California citizens were not. The actions of the ‘tax the rich’ viewpoint used an administrative ‘loophole’ to pass a tax increase bypassing the clear intent of the California Constitution. Anyone who argues that it is a scam to apply existing law to legally minimize or eliminate taxes clearly has not studied the law in this area,” concluded Alston.

Aero & Marine Tax Professionals works in the highly specialized area of California and Arizona Sales Tax Law. The company is dedicated to assisting taxpayers in legally avoiding sales and use tax on aircraft, vessels and vehicles by administering a program that helps them to support a claim for exemption. The company is in its second decade of working with CPAs and attorneys assisting their clients with new acquisitions as well as filing petitions, and claims for refund and audit defense.