FAA Asks IRS to Suspend Fuel Tax

 - October 17, 2006, 7:46 AM

Business aviation groups welcomed a letter from the FAA to the commissioner of internal revenue asking him to suspend implementation of new fuel tax rules that would impose a “significant administrative burden” on general aviation businesses and “create financial risk for the Airport and Airways Trust Fund.” The new rules would raise the tax rate on jet fuel to that of costlier highway diesel fuel but allow aviation jet fuel buyers to apply for a refund for the difference between the highway rate and the jet fuel rate. The new provisions would also require that all jet fuel taxes collected at the higher rate first go into the Highway Trust Fund. From there, they would go into the aviation trust fund, but only after the purchaser applies for a credit.