Los Angeles County Issues Tax Bills for Private Jets to Jeff Bezos and Others
According to Forbes citing the Los Angeles Times, Los Angeles County has issued tax bills to a group of private jet owners, including Amazon founder Jeff Bezos, singer Rihanna, Rams owner Stan Kroenke, Nike co-founder Phil Knight, and South Park creators Trey Parker and Matt Stone, among others.
California levies an annual property tax of about 1% on aircraft that are "habitually parked" in the state, with penalties for late payments. County Assessor Jeff Prang sent out bills totaling approximately $38 million to hundreds of aircraft owners. The list obtained by the Times was verified by aircraft ownership investigation firm JetSpy: Bezos owes about $244,000, Kroenke about $290,000 for two jets, Rihanna about $104,000 for an associated aircraft, Knight about $89,000, and Parker and Stone about $95,000. The list also includes Judy Sheindlin and others.
Most celebrity agents told the Times they were unaware of the need to pay Los Angeles County and quickly made payments upon notification. The assessor's list shows that Bezos and Knight had not settled their final bills by the June 30 deadline. Some aircraft owners only received assessment notices and did not get final bills due to staff delays. Kroenke's aircraft are registered under a Montana company he manages.
This tax targets aircraft that spend most of their time on the ground in California, rather than federal income tax. Chief Assessor Antonio Castro stated they are checking for unreported fleets. At the federal level, there is a provision in the "Pilot and Aircraft Privacy Act" aimed at limiting government taxation based on surveillance data, which state and local tax authorities view as a tax avoidance loophole.
Private jets are often held through out-of-state companies, making parking data crucial for taxation. The county's finance department has re-included hangars and assets on taxiways into the tax base, which is relatively small compared to the net worth of the owners but is a collectible amount for the local budget.
In market terms, the taxing authority is the county government treating parked aircraft as taxable real estate, while the payers are ultra-high-net-worth individuals holding the aircraft through corporate shells. The driving force is the assessor's cross-referencing of bills and flight data, rather than federal tax increases. Funds flow from the owners' accounts into the county treasury, with penalties accruing for non-payment. The beneficiaries are Los Angeles County's tax revenues, while the burden falls on fleets that regularly take off and land in California but are registered in low-tax states.
Source: Public Information
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California's 1% aircraft property tax is not new; what is new is the assessor's willingness to use flight trajectories against owners. The appearance of Bezos, Rihanna, and Kroenke on the same collection notice indicates that assets are flying in the air while the tax base is grounded: as long as "habitually parked" is determined to be in Los Angeles, the Montana company shell cannot shield them. Most people claim ignorance, which results from the separation of registration location and actual hangar. Prang views the $38 million as a collection project; the amount is trivial for billionaires but represents a tangible political achievement for the county government.
The capital path involves aircraft registered in out-of-state LLCs, parked in California hangars, and tax bills sent to celebrity offices. Data providers like JetSpy connect tail numbers, companies, and managers, allowing assessors to issue bills. The motivation is for local finances to seek mobile assets beyond property taxes; the strategy is to use public lists to increase compliance rates, prompting unlisted owners to self-report. If federal privacy legislation restricts the use of surveillance data for taxation, this path will be cut off, hence state tax officials are lobbying Congress.
Comparable examples include yacht docking taxes, supercar usage taxes, and Switzerland's taxation on private jet parking. States in the U.S. have long competed for fleet tax bases, and California has turned this list into news. The phase has shifted from tacitly allowing underreporting to naming and collecting, but it has not yet escalated to a federal uniform aviation property tax.
This represents a regulatory change. The mechanism of change is that the tax status of movable assets follows the registration location, while assessments follow the parking location; misalignment creates tax liabilities. Once flight data can serve as evidence, the misalignment is squashed. Billionaires can plan their federal income taxes to nearly zero in certain years, but every night an aircraft is parked generates a tax base for the county government. The deterrent effect of the list is greater than the tax amounts themselves.
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- Aircraft fly in the air, the tax base is where they overnight.
- Ignorance of payment obligations usually results from the registration location and hangar not being in the same state.
- A small tax bill for billionaires is big news for the county government.