It’s hard to imagine a greater extravagance than a private jet—and a more exclusive group than the people rich enough to ride one.
Yet this tiny team of uber-wealthy high fliers has carved out a massive tax break for themselves at the expense of everyone else. And it’s only going to get worse if the Trump-GOP tax bill becomes law. The Senate plans to vote on the bill Friday.
Given just how obscenely lavish private jet travel is, it might come as some surprise how much the rest of us flying coach subsidize the private jet set. Private jets get over a billion dollars in tax breaks every year—while using 10 times more air traffic control resources than they actually pay for.
Our new report for the Institute for Policy Studies looks at how the private jet lobby keeps these obscene tax handouts to the ultra-rich in place.
Commercial airline passengers flying from Nashville to Philadelphia, to cite just one example, pay 40 times more in taxes than private jet passengers flying the exact same route. The Trump tax cuts include a provision that will maintain and actually expand this massive tax subsidy to private jet leasing companies like NetJets.
The Trump tax cuts involve trillions of dollars in changes to the tax code, and the private jet carve-out is admittedly a small portion of that overall shift. However, it’s indicative of whose priorities are being represented by Republicans in Congress and in the White House.
According to the Center on Budget and Policy Priorities, middle-class families making between $40,000 and $50,000 a year will see a combined tax increase of about $5 billion. Not coincidentally, households making over $1 million a year will see a tax decrease of about $6 billion.
Of the many losers in the tax bill are teachers who will no longer be able to deduct the money they spend out of pocket for their students’ school supplies. And graduate students will see a massive tax increase as a result of a provision to treat their tuition waivers as ordinary income.
Put simply, this is a direct redistribution of wealth from ordinary Americans to the ultra-wealthy. The non-partisan Tax Policy Center calculated the Trump tax cuts will award 62% of the overall benefit to the top 1% of households. This isn’t just bad economics—it’s morally reprehensible.
The tentacles of this legislation reach across the economy, impacting everyone. And for those who aren’t rich, that impact is universally terrible.
It’s even more telling when you consider the budget legislation that’s coming in the wake of this tax vote. A provision in the Senate appropriations bill would make it more expensive to fly commercially, nearly doubling the passenger facility fee that ordinary airline passengers pay.
Are the private jet passengers getting a comparable increase? Nope.
When jetsetter millionaires and billionaires have so much money that they can fly to any part of the world they want, any time they want, in their own private jets, it’s abundantly clear they don’t need a tax break. At least that’s clear to everyone besides Trump and congressional Republicans.
Chuck Collins and Josh Hoxie are inequality experts at the Institute for Policy Studies. They coauthored the aforementioned report, “High Flyers 2017.”