Second Regular Session
Seventy-third General Assembly
STATE OF COLORADO
INTRODUCED
LLS NO. 22-0537.01 Ed DeCecco x4216
HOUSE BILL 22-1109
House Committees Senate Committees
Business Affairs & Labor
A BILL FOR AN ACT
C
ONCERNING THE CREATION OF A SA LES AND USE TAX EXEMPTION FOR101
AN ON-DEMAND AIR CARRIER'S AIRCRAFT.102
Bill Summary
(Note: This summary applies to this bill as introduced and does
not reflect any amendments that may be subsequently adopted. If this bill
passes third reading in the house of introduction, a bill summary that
applies to the reengrossed version of this bill will be available at
http://leg.colorado.gov
.)
For 7 years beginning on January 1, 2023, the bill creates a sales
and use tax exemption for the sale, storage, use, or consumption of an
aircraft used or purchased for use in interstate or intrastate commerce by
an on-demand air carrier. An on-demand air carrier is an entity authorized
by the federal aviation administration to operate an aircraft to transport
people or property in compliance with the administration's certification
HOUSE SPONSORSHIP
Woog and Bird,
SENATE SPONSORSHIP
Lundeen and Kolker,
Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment.
Capital letters or bold & italic numbers indicate new material to be added to existing statute.
Dashes through the words indicate deletions from existing statute. and operations requirements.
The aeronautics division in the department of transportation is
required to provide the state auditor with any available information that
would assist the state auditor's measurement of the effectiveness of the
exemption.
The bill specifies that a statutory town, city, or county may exempt
the same items only by express inclusion of the exemption in its initial
sales tax ordinance or resolution or by amendment thereto and also that
the exemptions do not apply to the tax imposed by a special district or
other limited purpose governmental entity.
Be it enacted by the General Assembly of the State of Colorado:1
SECTION 1. In Colorado Revised Statutes, amend 39-26-711 as2
follows:3
39-26-711. Aircraft - tangible personal property - tax4
preference performance statement - legislative declaration -5
definition. (1) The following shall be
ARE exempt from taxation under6
the provisions of part 1 of this article ARTICLE 26:7
(a) Effective July 1, 1984, the sale of aircraft used or purchased8
for use in interstate commerce by a commercial airline; and9
(b) The sale of tangible personal property that is to be permanently10
affixed or attached as a component part of an aircraft;
AND11
(c) O
N AND AFTER JANUARY 1, 2023, BUT BEFORE JANUARY 1,12
2030,
THE SALE OF AIRCRAFT USED OR PURCHASED FOR USE IN INTERSTATE13
OR INTRASTATE COMMERCE BY AN ON -DEMAND AIR CARRIER.14
(2) The following shall be
ARE exempt from taxation under the15
provisions of part 2 of this article ARTICLE 26:16
(a) Effective July 1, 1984, the storage, use, or consumption of17
aircraft used or purchased for use in interstate commerce by a commercial18
airline; and19
(b) The storage, use, or consumption of any tangible personal20
HB22-1109-2- property that is to be permanently affixed or attached as a component part1
of an aircraft;
AND2
(c) T
HE STORAGE, USE, OR CONSUMPTION OF AIRCRAFT USED OR3
PURCHASED FOR USE IN INTERSTATE OR INTRASTATE COMMERCE BY AN4
ON-DEMAND AIR CARRIER, IF THE AIRCRAFT WAS USED OR PURCHASED FOR5
USE IN THIS STATE ON AND AFTER JANUARY 1, 2023, BUT BEFORE JANUARY6
1,
2030.7
(3) (a) T
HE GENERAL ASSEMBLY HEREBY FINDS AND DECLARES8
THAT:9
(I) A
RECENT SURVEY OF SEVERAL COLORADO-BASED ON-DEMAND10
AIR CARRIERS REFLECTED THAT, ON AVERAGE, EACH AIRCRAFT CREATES11
SLIGHTLY MORE THAN FIVE JOBS TO SUPPORT ITS OPERATION ;12
(II) C
OLORADO HAS A NUMBER OF ON-DEMAND AIR CARRIERS THAT13
WILL HAVE INCREASED ACCESS TO ADDITIONAL AIRCRAFT AS A RESULT OF14
THE EXEMPTIONS CREATED IN SUBSECTIONS (1)(c) AND (2)(c) OF THIS15
SECTION;16
(III) T
HE EXEMPTION WILL HELP CURRENT ON -DEMAND AIR17
CARRIERS TO UPDATE THEIR FLEETS WITH NEWER AIRCRAFT THAT HAVE18
ENHANCED SAFETY FEATURES ; AND19
(IV) C
OLORADO'S RURAL COMMUNITIES WILL BENEFIT THROUGH20
ADDITIONAL SERVICE BECAUSE SERVICE PROVIDERS CRITICAL TO RURAL21
COMMUNITIES, SUCH AS MEDICAL SUPPORT , RELY ON ON-DEMAND AIR22
CARRIERS TO ACCESS COMMUNITIES WITH NO COMMERCIAL AIRLINE23
SERVICE.24
(b) I
N ACCORDANCE WITH SECTION 39-21-304 (1), THE PURPOSES25
OF THE TAX EXPENDITURES CREATED IN SUBSECTIONS (1)(c) AND (2)(c) OF26
THIS SECTION ARE TO:27
HB22-1109
-3- (I) INDUCE CERTAIN DESIGNATED BEHAVIOR BY TAXPAYERS ,1
WHICH IN THIS INSTANCE IS TO PLACE ADDITIONAL AIRCRAFT IN2
COMMERCIAL SERVICE IN COLORADO; AND3
(II) T
O CREATE OR RETAIN JOBS.4
(c) T
HE GENERAL ASSEMBLY AND THE STATE AUDITOR SHALL5
MEASURE THE EFFECTIVENESS OF THE EXEMPTION IN ACHIEVING THE6
PURPOSES SPECIFIED IN SUBSECTION (3)(b) OF THIS SECTION BASED ON THE7
NUMBER OF ADDITIONAL AIRCRAFT IN COMMERCIAL SERVICE AND JOBS8
CREATED OR RETAINED AFTER THE EXEMPTION IS CREATED . THE9
AERONAUTICS DIVISION IN THE DEPARTMENT OF TRANSPORTATION ,10
CREATED IN SECTION 43-10-103 (1), SHALL PROVIDE THE STATE AUDITOR11
WITH ANY AVAILABLE INFORMATION THAT WOULD ASSIST THE STATE12
AUDITOR'S MEASUREMENT.13
(4) T
HE EXEMPTIONS SET FORTH IN SUBSECTIONS (1)(c) AND (2)(c)14
OF THIS SECTION SHALL NOT APPLY TO THE TAX IMPOSED BY A SPECIAL15
DISTRICT OR OTHER LIMITED PURPOSE GOVERNMENTAL ENTITY THAT IS16
AUTHORIZED BY LAW TO LEVY SALES OR USE TAX UPON ALL17
TRANSACTIONS OR INCIDENTS WITH RESPECT TO WHICH THE STATE LEVIES18
SALES OR USE TAX, REGARDLESS OF WHETHER THE AUTHORIZATION19
SPECIFICALLY REFERENCES THIS ARTICLE 26.20
(5) A
S USED IN THIS SECTION, "ON-DEMAND AIR CARRIER" MEANS21
AN ENTITY AUTHORIZED BY THE FEDERAL AVIATION ADMINISTRATION TO22
OPERATE AN AIRCRAFT TO TRANSPORT PEOPLE OR PROPERTY IN23
COMPLIANCE WITH THE CERTIFICATION AND OPERATIONS REQUIREMENTS24
SET FORTH IN 14 CFR 133 OR 135.25
SECTION 2. In Colorado Revised Statutes, 29-2-105, add26
(1)(d)(I)(Q) as follows:27
HB22-1109
-4- 29-2-105. Contents of sales tax ordinances and proposals.1
(1) The sales tax ordinance or proposal of any incorporated town, city,2
or county adopted pursuant to this article 2 shall be imposed on the sale3
of tangible personal property at retail or the furnishing of services, as4
provided in subsection (1)(d) of this section. Any countywide or5
incorporated town or city sales tax ordinance or proposal shall include the6
following provisions:7
(d) (I) A provision that the sale of tangible personal property and8
services taxable pursuant to this article 2 shall be the same as the sale of9
tangible personal property and services taxable pursuant to section10
39-26-104, except as otherwise provided in this subsection (1)(d). The11
sale of tangible personal property and services taxable pursuant to this12
article 2 shall be subject to the same sales tax exemptions as those13
specified in part 7 of article 26 of title 39; except that the sale of the14
following may be exempted from a town, city, or county sales tax only by15
the express inclusion of the exemption either at the time of adoption of16
the initial sales tax ordinance or resolution or by amendment thereto:17
(Q) T
HE ON-DEMAND AIR CARRIER EXEMPTIONS SET FORTH IN18
SECTION 39-26-711 (1)(c) AND (2)(c).19
SECTION 3. Act subject to petition - effective date. This act20
takes effect at 12:01 a.m. on the day following the expiration of the21
ninety-day period after final adjournment of the general assembly; except22
that, if a referendum petition is filed pursuant to section 1 (3) of article V23
of the state constitution against this act or an item, section, or part of this24
act within such period, then the act, item, section, or part will not take25
effect unless approved by the people at the general election to be held in26
HB22-1109
-5- November 2022 and, in such case, will take effect on the date of the1
official declaration of the vote thereon by the governor.2
HB22-1109
-6-