Modifying the sales and use tax exemption for the sale of certain component parts attached to or services performed on aircraft

Current law exempts from the Iowa sales and use tax the sale, rental, or use of aircraft component parts permanently attached to an aircraft, including repair or replacement materials or parts, and repair, remodeling, and maintenance services used on an aircraft, aircraft engine, or aircraft component materials or parts, provided the aircraft is used in either a scheduled or nonscheduled interstate federal aviation administration (FAA) certified air carrier operation (scheduled or nonscheduled FAA operation). This bill removes the requirement that the aircraft be used in a scheduled or nonscheduled FAA operation to qualify for the exemption. The sale, rental, or use of the component parts and services described above will be exempt from the sales and use tax when permanently attached to or performed on any aircraft. The bill defines “aircraft” to mean the same as it does for purposes of Code chapter 328 (aeronautics), which includes any contrivance now known, or hereafter invented, used or designed for navigation of or flight in the air, for the purpose of transporting persons or property, or both.3(75) to strike or move similar language relating to the sales and use tax exemption described in the bill and to the sales and use tax exemption for the sale or rental of aircraft used in a scheduled FAA operation.