Corporate aviation has been the seen as a luxury abused by large corporations, “Nothing symbolizes corporate excess in this economy like a private jet (Demerjian 2009). I remember in 2008 executives were scrutinized for flying their private jets to a hearing in front of congress for their hearing regarding their 25 billion dollar bailout. As of recently these companies have begun to ditch their jets in hopes to better their image from abusing such luxury. Business jets have helped executives and employees of companies get from destination to destination faster and easier than having to wait for a commercial flight. Many people think of corporate aviation and think of expensive jets and used in excess but in big business companies are always looking to save money an a business jet may be the answer in some cases when it comes to investing in travel.
I personally feel that corporate aviation is vital to our economy because it is a market in which provides goods in services in return this provides jobs. I think the most important aspect of corporate aviation is that it is domestic, which means that the utilization of this service contributes to the U.S. economy.
In 2012 during his debate with Mitt Romney, President Barrack Obama made the following comment "My attitude is, if you got a corporate jet, you can probably afford to pay full freight, not get a special break for it,”(Obama, 2012). When he made this comment I believe he was referring to the tax break corporate aviation receives with accelerated depreciation on assets. Accelerated depreciation as defined by Investopedia, is “Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years of the life of an asset.” Although he may or may not be right that these companies may be able to afford to pay “full freight” on taxes the purpose of these stimulus package is to encourage purchase of services goods and services in corporate aviation.
Aviation Advocates have completely different views than the president. Through my research I stumbled across a website called NoPlanenoGain.org a website used by the General Aviation Manufacturers Association (GAMA) and the National Business Aviation Association. These companies believe that the use of aircraft in corporations can be vital to their success as long as they are used properly (No Plane No Gain 2013).
I don’t believe that the mass abundance of business jets of some corporations is completely justified when it comes to luxuries of use of aircraft for non-business purpose. On the contrary I believe I agree that the use of corporate jet aircraft can be extremely beneficial when used properly and efficiently.
Sources
Accelerated Depreciation (n.d) Investopedia online, Retrieved from http://www.investopedia.com/terms/a/accelerateddepreciation.asp#axzz2KeoScL4O
Demerjian D. (2009) Gerneral Aviation Sounds MayDay as Fat Cats Ditch Their Jets (2009) Retrieved from. http://www.wired.com/cars/coolwheels/news/2009/05/corporatejets0513
NoPlaneNoGain (2013) It's A Fact: Business Aviation Is Essential To America (2013) Retrieved From http://www.noplanenogain.org/Quick_Facts.htm?m=47&s=391
Obama (2012) Federal News Service (2012) Retrieved from http://www.npr.org/2012/10/03/162258551/transcript-first-obama-romney-presidential-debate
Accelerated Depreciation (n.d) Investopedia online, Retrieved from http://www.investopedia.com/terms/a/accelerateddepreciation.asp#axzz2KeoScL4O
In 2012 during his debate with Mitt Romney, President Barrack Obama made the following comment "My attitude is, if you got a corporate jet, you can probably afford to pay full freight, not get a special break for it,”(Obama, 2012). When he made this comment I believe he was referring to the tax break corporate aviation receives with accelerated depreciation on assets. Accelerated depreciation as defined by Investopedia, is “Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years of the life of an asset.” Although he may or may not be right that these companies may be able to afford to pay “full freight” on taxes the purpose of these stimulus package is to encourage purchase of services goods and services in corporate aviation.
Aviation Advocates have completely different views than the president. Through my research I stumbled across a website called NoPlanenoGain.org a website used by the General Aviation Manufacturers Association (GAMA) and the National Business Aviation Association. These companies believe that the use of aircraft in corporations can be vital to their success as long as they are used properly (No Plane No Gain 2013).
I don’t believe that the mass abundance of business jets of some corporations is completely justified when it comes to luxuries of use of aircraft for non-business purpose. On the contrary I believe I agree that the use of corporate jet aircraft can be extremely beneficial when used properly and efficiently.
Sources
Accelerated Depreciation (n.d) Investopedia online, Retrieved from http://www.investopedia.com/terms/a/accelerateddepreciation.asp#axzz2KeoScL4O
Demerjian D. (2009) Gerneral Aviation Sounds MayDay as Fat Cats Ditch Their Jets (2009) Retrieved from. http://www.wired.com/cars/coolwheels/news/2009/05/corporatejets0513
NoPlaneNoGain (2013) It's A Fact: Business Aviation Is Essential To America (2013) Retrieved From http://www.noplanenogain.org/Quick_Facts.htm?m=47&s=391
Obama (2012) Federal News Service (2012) Retrieved from http://www.npr.org/2012/10/03/162258551/transcript-first-obama-romney-presidential-debate
Accelerated Depreciation (n.d) Investopedia online, Retrieved from http://www.investopedia.com/terms/a/accelerateddepreciation.asp#axzz2KeoScL4O
Adam, I never thought about Corporate Aviation providing jobs but you have a good point there. When businesses starts accumulating steady income, corporate businesses will definitely need pilots to fly their corporate jets to transport goods and even the CEO. Also, they will need Accountants to keep track of their finances. So in that case, it maybe beneficial for the economy as well but more money will have to be dished out to pay for employment.
ReplyDeleteIn my opinion the only way corporate aviation is useful to a business is the time efficiency and comfort. Sure it will probably impress important clients while on a business trip, but if anything it costs a company a lot more money than it costs to just schedule your trips commercially. I just believe that companies with private jet money should be paying more taxes than the smaller companies who could hardly afford their planes.
ReplyDeleteAdam, I really enjoyed your blog. A lot of what you said is the opposite of my opinion, but I still think that what you had to say informed me enough to at least dive deeper into the topic. When looking into the topic and reading up on corporate aviation, I looked at into it more from a small-business point of view. While I do agree with you that tax payers should not front the bill for corporate aviation, I also don't believe that businesses that are investing money into corporate aviation should be punished for it, especially those small-businesses.
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