Resolution Urging Congress to Eliminate Discriminatory State and Local Taxes on Automobile Renters Exposed

The Resolution Urging Congress to Eliminate Discriminatory State and Local Taxes on Automobile Renters was adopted by ALEC's Tax and Fiscal Policy Task Force at the Spring Task Force Summit on May 17, 2008, approved by the Board of Directors June, 2008. An updated version of the resolution is available on ALEC.org, adopted by the Tax and Fiscal Policy Task Force at the ALEC Annual Meeting on July 23, 2015 and July 24, 2015, approved by ALEC Board of Directors on September 4, 2015. Any language removed from the original version is indicated with strikethrough text and additions are given in bold. (Accessed on 2/1/2016).

ALEC Resolution Text

Summary

This resolution encourages Congress to eliminate discriminatory State and Local Taxes on automobile renters (by passing H.R. 2453, the End Discriminatory State Taxes on Automobile Renters Act of 2007 (EDSTAR)).

Model Resolution

WHEREAS, since 1976, 42 43 states and the District of Columbia have enacted more than 100 car rental excise taxes, which are beyond typical sales taxes, resulting in car rental customers paying more than $6 $7.5 billion since 1990; and

WHEREAS, the National League of Cities in its May 2006 publication of TAXING PROBLEMS: Municipalities and America’s Flawed System of Public Finance recognized this unfair taxing burden on specific economic sectors and among its suggested solutions stated that “Governments should impose equitable and fair revenue burdens on individuals, corporations, communities, sectors, income classes and generations”; and

WHEREAS, the revenues from the vast majority of these taxes have gone to pay for unrelated projects such as sports stadiums, convention centers, performing arts centers, art museums, police and fire stations and public transportation; and

WHEREAS, state and local officials have rationalized these excise taxes because they believe the majority of these taxes will be paid by out-of-towners, thereby intentionally interfering with interstate commerce; and

WHEREAS, Congress has the constitutional power to regulate commerce among the states and has given protection to industries that are a part of interstate commerce – such as railroads, airlines, trucking and buses – from state and local governments that wished to discriminately tax those industries; and

WHEREAS, representatives Rick Boucher (D-VA) and Chris Cannon (R-UT), along with six other original bi-partisan co-sponsors, have introduced H.R. 2453 that would prohibit state and local governments prospectively from discriminately taxing car renters, based upon the federal law that protects other industries mentioned above; and

WHEREAS, there is a growing coalition – the Coalition Against Discriminatory Car Rental Excise Taxes – of business and consumer organizations supporting H.R. 2453 Curb Automobile Rental Taxes (CART) Coalition. The coalition consists of Alamo Rent A Car, the American Car Rental Association, American Society of Travel Agents, Americans for Tax Reform, Avis Rent-A-Car, Budget Rent-A-Car, Dollar Rent A Car, Enterprise Rent-A-Car, The Hertz Corporation, National Car Rental, National Global Business Travel Association, National Consumers League, National Limousine Association, Thrifty Car Rental, and Truck Renting and Leasing Association; and Urban League, US Hispanic Chamber of Commerce, the US Pan-Asian Chamber of Commerce, Thrifty Car Rental, and Truck Renting and Leasing Association; and

WHEREAS, the American Legislative Exchange Council (ALEC), according to the Statement of Principles on Local Option Taxes believes that when raising revenue, government should ensure that no one is disproportionately burdened

NOW THEREFORE BE IT RESOLVED, that ALEC urges Congress to pass H.R. 2453 to end discriminatory excise taxes on all car renters, and

BE IT FURTHER RESOLVED, copies of this resolution will be distributed to all Governors and members of the U.S. Senate and the U.S. House of Representatives.

NOW THEREFORE BE IT RESOLVED, that {insert state} urges Congress to end discriminatory excise taxes on all car renters.

Adopted by the Tax and Fiscal Policy Task Force at the Spring Task Force Summit, May 17, 2008.

Approved by the ALEC Board of Directors June 2008.