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GBTA Fights Car Rental Taxes in Washington StateMarch 30, 2011 By: George Dooley Travel Agent
The Global Business Travel Association (GBTA) has submitted a letter to the Washington State Senate Ways and Means Committee opposing HB 1997, a proposed permanent extension of both the 2 percent Safeco and 1 percent Kingdome Car Rental Taxes in Washington State.
These taxes, sold as a tax for non-state residents (non-voters), were to expire after the stadium bond was paid in full, GBTA says. Now, however, legislators hope to extend these taxes to pay for arts and heritage programs, athletic facilities, tourism promotion, Martin Luther King Jr. Workforce housing, convention centers and other projects. Regardless of the worthiness of the projects, the GBTA believes that the cost should be borne by those who benefit, not on business people who are passing through the state.
“These taxes were introduced with a definite end date, extending them in perpetuity will be damaging to Washington’s business economy,” said Jane Bankester, president of the Puget Sound Business Travel Association. “The time has come for these taxes to expire.”
Opposition to excise taxes on car rentals is supported by GBTA studies showing that a majority of travel managers rent a majority of their cars from their local markets. According to one study, local customers paid more than 62 percent of this tax collected in 2010, making this a hidden tax on local residents and companies.
“The common misperception that car rental excise taxes are painless for local residents and businesses is as pernicious as it is incorrect,” said Mike McCormick, executive director and COO, GBTA. “Yet, state legislatures continue to view car rental taxes as a viable revenue generating vehicle. GBTA and our member companies are cognizant of the challenges faced by states and communities; however, our businesses are also a part of these communities.”
GBTA’s more than 5,000 members manage more than $340 billion of global business travel and meetings expenditures annually. Its network extends to 17,000 business and government travel and meetings managers, as well as travel service providers.