Car Excise Taxes Bad for Business Travelers, Economy

Business travel is hard—and expensive—enough. States and local governments shouldn’t make it even harder and more expensive by adding unnecessary taxes on car rentals.

But that is exactly what many such governments are doing, and business travelers from companies of all sizes are paying the price, along with automakers, consumers and insurers.

It’s time for Congress to step in.

Here’s how it usually works: an important person in a city, perhaps a sports team owner, wants to build a new facility. But of course, he or she doesn’t want to pay for it themselves. So they convince the local government of the economic benefits of the facility, and that building the facility should be financed via public funds.

These funds are very often raised by slapping a significant tax on car rentals, which disproportionately hurts the poor and other groups, and hurts the economy.

In response, GBTA has joined a diverse coalition of similarly minded organizations known as Curb Auto Rental Taxes (CART) Coalition to fight to end car rental excise taxes across the United States. We joined CART because we believe these taxes are regressive, highly discriminatory and terrible for the economy.

Because of the nature of the car rental business, certain populations are more heavily impacted, including business travelers, minorities, small businesses and the poor. These excise taxes also increase the cost of insurance for everyone.

Luckily, a legislative solution is already primed and ready to go—if only it can get enough support. Currently, Congress is considering the bi-partisan End Discriminatory State Taxes for Automobile Renters Act (EDSTAR), which would stop municipalities and states from forcing discriminatory taxes on car or truck renters.

For years, groups like CART and allies both in and out of Congress have been working to get this important bill passed. To date, they have been unsuccessful—but there is reason to hope 2015 is the year something will happen.

Don’t you think it’s time for Congress to stop local and state governments from using local taxpayers, tourists, and travelers to help fund their pet projects?

If you’d like to show your support for this legislation you can Take Action through the GBTA Legislative Action Center.

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