The Biden administration is focusing on corporate jets to increase government revenue, aiming to make big companies pay more in taxes and combat tax evasion among the wealthy.
Private air travel, often seen as extravagant, has captured the attention of Democrats looking to eliminate tax incentives that encourage its use.
The proposed tax increases include targeting corporate aviation and monitoring executives who use company planes for personal trips.
President Biden highlighted the taxation of corporate jets in his recent speeches as part of his efforts to ensure big corporations pay their fair share.
Treasury Secretary Janet L. Yellen commended the Internal Revenue Service for its initiative to curb abuse of corporate jet tax write-offs.
The proposals have faced criticism from the corporate aviation industry, arguing that they unfairly disadvantage American companies relying on private planes for business travel.
The White House estimates that the tax changes would generate $4 billion in revenue over the next decade.
The IRS intends to implement new audits focusing on large companies, partnerships, and wealthy taxpayers to ensure compliance with tax laws related to corporate jets.
The I.R.S. will scrutinize corporate jet passengers to ensure proper reporting of personal trips as income, targeting cases where tax deductions are claimed for personal use.
Daniel Werfel, the I.R.S. commissioner, credits improved technology for enhancing the agency’s ability to detect inappropriate write-offs for personal use of corporate jets.
Some industry experts believe the proposed audits may not yield as much additional tax revenue as expected, pointing out that corporate air travel is often necessary for executives even on personal trips.
