Loopholes are legal. There is tax avoidance and tax evasion - the former uses legal mechanisms to reduce liability and the latter is just illegal.
If you put funds into your pension, and thus legally reduced your tax liability, no one would call it a loophole. This was simply the way it was supposed to operate.
Likewise, FAA licenced pilots flying N-reg aircraft isn't a loophole. It's simply the way it was supposed to operate.
I agree that calling this a loophole is a hindrance. You certainly wouldn't find the word loophole in any document reviewed by a
PR consultant who was working for GA on this issue.
dp