CO HB1109

Creates a 7-year sales and use tax exemption for aircraft used or purchased for use in interstate or intrastate commerce by on-demand air carriers, effective January 1, 2023 through January 1, 2030.

Defines an on-demand air carrier as an entity authorized by the Federal Aviation Administration to operate aircraft for transporting people or property under 14 CFR 133 or 135 certification and operations requirements.

Requires the aeronautics division in the department of transportation to provide information to the state auditor to measure the exemption's effectiveness based on additional aircraft in commercial service and jobs created or retained.

Exemption applies only to state sales and use taxes; does not apply to taxes imposed by special districts or other limited purpose governmental entities, and may only be adopted by towns, cities, or counties through express inclusion in their initial sales tax ordinances or by amendment.

Legislative findings state the exemption will support job creation (averaging over 5 jobs per aircraft), help on-demand air carriers update fleets with newer safer aircraft, and enhance service to Colorado's rural communities lacking commercial airline service.