Washington State repeals luxury aircraft tax By Katia Veraza VAI is excited to share a significant win for the vertical aviation industry in Washington. The luxury aircraft tax enacted in the state last year, which was set to take effect Apr. 1, 2026, has been fully repealed following the passage and signing of H.B.2711 on Mar. 31, 2026. The repealed provision would have imposed a 10% tax on the sale, lease, or transfer of private aircraft valued at over $500,000. Since last year, VAI and industry stakeholders have raised concerns that the tax would discourage investment and reduce aviation activity in the state. Its repeal helps preserve a more competitive operating environment. VAI thanks Gov. Bob Ferguson, state legislators, and industry partners whose engagement and advocacy were critical to achieving this outcome. Key Provisions of H.B.2711 Aircraft Fuel Tax • Increases from 18 cents to 25 cents per gallon • Revenue distribution: – 72%: Aeronautics account (airport grants, aviation programs, and so on) – 28%: Sustainable aviation fuel (SAF) infrastructure account. Aircraft Registration Fees • Increase from $15 to $30 annually • Increase 2% annually beginning in 2028 • Revenue distribution: – 50%: Aeronautics account – 50%: SAF account. SAF Account • Establishes a dedicated fund for SAF infrastructure development and preservation at airports • Is funded through portions of fuel taxes, registration fees, and excise taxes • Is limited to aviation-related sustainability. VAI will continue to monitor implementation and engage accordingly. We appreciate the input from our members and the broader industry, which was instrumental in conveying the real-world impacts of the tax and supporting its repeal. Katia Veraza is the director of state government affairs and regional relations for VAI.
