To answer the question I think the issue with GA in Europe has a number of much more simple facets.
In terms of using an aircraft for business as Peter said the days of the travelling salesmen are gone, and even if they hadnt, GA is totally impractical for the typical travelling salesmen because of the all the issues with onward travel, and weather uncertainty.
That leaves the “executive” / “professional” market where there is a need for the person to visit a “client”. They are no less immune from weather / on ward travel, but may have the luxury of a little more flexibility and the cost of a taxi is largely irrelevant. However, the use of an aircraft is often going to be set against other conventional means of transport and in many cases this will be equally as quick and potentially more convenient. For me, the journey needs to be around 2.5 hours by car for the aircraft to compete in terms of time, taking into account all the components.
Over longer distances GA gains an advantage, especially if some water is involved, BUT for any degree of assured reliability an instrument rating is needed, and as the journey approaches a day lengths by the time a meeting is involved half the year is ruled out because everything pretty much closes by the time you want to come home, never mind the stress of knowing that you are tied to a strict schedule. I recall once leaving with the GPS predicting an arrival 15 minutes after the airport closed (I did have an alternative but it was far from covenient). Every trick in the book got it down to a few minutes, and as it turned out ATC were very kind, but it isnt something you want to do regularly.
For pleasure, on the face of it there is more utility, but the reality is for holidays of any length it is often impractical. Anyone renting is out, because it is not commercially viable to have an aircraft on the ground for a week. Not many want to spend the week flying from one destination to another (a sort of travelling holiday), and for many taking some luggage and a child or two rules out many typical four seaters as well. All in all it works for the devoted GA’er but that is a small number of people.
America of course does it all much better. Airports dont close (is a big factor) and cars are often available at the airport on loan. Flying into Miami Int recently and watching the flow of traffic not only was it pretty constant flow but a mix of golfers, other leisure seekers and business executive, all in very capable aircraft, often not owner piloted, and coming good distances. I have never experienced a similiar ramp any where in Europe. At Key West the mix was greater, but the intent little different. In contrast to Europe there was a clear business model, rather than a flying club / hobby set up.
I think therefore using GA in any practical way will always be for a very small market of pilots which limits the entreprenurial mojo.
I have often thought there should be a far better market for the old fashion air taxi type work, but this is defeated by the regulation which makes setting up this sort of operation almost impossible with no good reason to think this might change.
Sad to say I think GA is in continued decline (at least in Europe at any rate) with little prospect of that changing, but hopefully will survive for some time to come as a wonderful passtime / hobby, with a few gaining some genuine utility use, probably may of who are EuroGA readers!
I didn’t know that the German LBA reports to the German tax office.
I don’t think they report to each other. But the aircraft registry is publicly available (not for free though) and a good tax inspector who suspects something will routinely look there. At least this is what you must be afraid of if you buy a plane with money that does not officially exist. Right now there are very few “M” and “VP” aircraft based around here (none left at my home airfield) because the tax people found out (either by themselves or by whistleblowing) that the owners may be worth investigating. Which brings us back to the original statement that a german person or company more or less openly confesses tax fraud by painting an “M” on the tail of their plane. Even our (in)famous “national” car manufacturer who has gotten his share of headlines in the last 12 months is now in the process of moving their aircraft from “VP” to “D”…
Which brings us back to the original statement that a german person or company more or less openly confesses tax fraud by painting an “M” on the tail of their plane.
IMHO that impression would be the biggest stereotype… that everybody rich is doing tax fraud. Obviously “poor prople” won’t be doing tax fraud because they have no money to do it with. I am sure there is a name for this type of statistical analysis 
There are many reasons for M-reg or VP-reg and we have had many threads on it. They start with tax concessions for based companies and go on to validation of FAA pilot papers…
Yes, licensing is a huge draw. When the CAA gets crazy, like they just did and banned all FAA class 3 medicals, then a M-reg is heaven sent. There you can continue to fly your M-reg on your FAA license and not have to deal with the crazies regulatory meltdowns changing every week. Or maintenance. An FAA IA can now sign it off, not some type 145 approved behemoth that don’t care about the little guy.
It’s a common misperception that using tax havens or special purpose vehicles automatically mean tax fraud. That notion is being drawn by politicians who are too stupid or lazy or powerless to write up a fair, transparent and understandable tax legislature in the first place – especially on an international level. And the public buys it, as we can see here. Peter is right, the bad examples we have seen have been internationally operating private banks, who have structured very, very special tax schemes to make a couple more basis points for their investors, who were – mostly average people investing their pension.
In real life, outside the dimwit talkshows and stupid politicians – tax structures involving tax havens, speical purpose vehicles and such stuff are completely legal, and in many cases even approved and validated by the financial and / or tax authority. And they are necessary to make an investment possible at all. Because all these kazillions or exemptions, special rules and benefits, deduction options and so on are different in every country. And if you want to structure a takeover, or a large international project, with investors from different legislatures, you have to use these structures. Simple as that.
Example ? When part of HSH Nordbank in Hamburg, the largest shipping financier in the world, was bought by a US private equity investor, it was done by by a couple of legal entities from the Caymans. Nobody cared, and nobody needed to care, because it was all legit.
So, registering a plane under M-reg can, but by no means has to mean there is tax fraud in play. Which is why I would wind down the rhetoric here quite substantially.
EuroFlyer wrote:
That notion is being drawn by politicians who are too stupid or lazy or powerless to write up a fair, transparent and understandable tax legislature in the first place – especially on an international level.
I agree with your comments except I suspect this tongue in cheek comment on our political class. I suspect the reality is that writing up this type of tax legislation is exceedingly complicated and dependent on the co-operation of other jurisdictions, not that of course it is the political class that ever write this sort of stuff up, that would be the civil servants.
As to using various vehicles few at this level intentionally flout the law, in fact far from it, but they do have to compete in an enviroment in which you are expected to take advanatge of any legitimate fiscal process, perhaps in the same way that you would hardly challenge the consumer shopping around for a bargain.
I get comments for having a dodgy country registration on my plane and it’s a G-reg. And I actually save taxes because UK insurance tax is 10% (up from 9.5% and going to increase to 12% this year) whereas German insurance tax is 19%.
Another great benefit is “regulatory arbitrage”. The most often frequented country of my aircraft is Germany. The UK CAA does not employ a lot of ramp checkers over here and the ones working for LBA have very limited authority and even less knowledge.
After Brexit (i.e. when the island sinks into the Atlantic and disappears from the map), I can stop my insurance tax evasion scheme and remove the G sticker and pretend that nothing ever happened.
PS: Not everybody with M/VP on the tail has something to hide. Not everybody loitering in the evening at the train station has something to do with drugs. However, there is a certain statistical connection…
;-)
What I saved with the lower insurance tax I’ll spend (this year) on the propeller governor, that has to be changed after 10 years, although working perfectly … Last year I threw away a 3 yo perfect Concorde battery for € 600
Why the battery?
Sounds like you need to get more involved with your plane because from what you say you are being ripped off.
I am involved max. Most maintenance i do myself with the shop. And nobody ripped me off. It’s all correct and according to the MM and the CAA.
My SR22 is an all electric airplane, and the batteries, both, have to be changed at certain intervals.
