Press Release
Curb Auto Rental Taxes Coalition Press Release: Millions of Americans Will Pay Excessive Rental Car Taxes over Summer Driving Season

Curb Auto Rental Taxes Coalition Press Release: Millions of Americans Will Pay Excessive Rental Car Taxes over Summer Driving Season

WASHINGTON, DC— As Memorial Day nears and the summer driving season begins, the Curb Auto Rental Taxes (CART) Coalition, a group of organizations dedicated to ending car rental excise taxes across the country, continues to call for support for the End Discriminatory State Taxes for Automobile Renters Act (EDSTAR).  The legislation would limit the discriminatory taxes state and local legislators can impose on automobile rentals by leveraging Congress’s well-established constitutional authority to regulate interstate commerce.

According to the American Automobile Association (AAA), 33 million Americans will travel at least 50 miles by automobile over the weekend, an increase of 5.3 percent over last year.

Their driving and vacationing habits are heavily impacted by their checkbooks, as AAA suggests lower gas prices are a significant factor in the increase in traffic.  However, in many jurisdictions, they will also pay exorbitant rental car taxes, which will discourage some families from vacationing altogether.

“We believe such taxes unfairly single out consumers who travel because they are taxed without representation,” explained CART spokesman Kevin Lawlor. “Local politicians target these consumers with impunity, believing that they live and vote in other jurisdictions, but this is not always the case.”

Since 1990, more than 100 burdensome rental car taxes have been enacted in 43 states and the District of Columbia, adding up to more than $7.5 billion in taxes above and beyond the standard sales taxes typically assessed on other goods and services.

More than half of all rental vehicles are actually rented by local customers, including individuals, families, and businesses. The greatest impact is on those who can least afford it;  in a recent study of consumers renting from off-airport locations in their own neighborhood, households earning less than $50,000 a year paid 41 percent of all car rental taxes.  Such taxes also in effect discriminate against minorities, who were 75 percent more likely to rent cars than non-Hispanic whites at these locations.

Americans traveling by almost any other means this summer will pay more reasonable taxes due to proper representation in Washington. The Constitution specifically protects consumers by providing Congress with the authority to regulate interstate commerce, as it has done with the Railroad Revitalization and Regulatory Reform Act of 1976, the Airport and Airway Improvement Act of 1982, and the Interstate Commerce Commission Termination Act of 1995, which applies to bus transportation.  

EDSTAR would have a comparable effect in supporting rental car companies as those laws have had on other industries, and the positive impact would extend to many parts of the overall economy.

The bill has strong bipartisan support on Capitol Hill and organizations from across the political spectrum have joined CART in advocating for the measure, including some of America’s leading companies, policy organizations, labor and consumer advocate groups, such as American Society of Travel Agents, Americans for Tax Reform, the National Urban League, United Auto Workers, Property Casualty Insurers Association of America, and the National Consumers League.

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