Industry Rallies Against Ariz. Rental Car Tax

The American Car Rental Association (ACRA) and other organizations have rallied against a proposed bill calling for a $1 increase on car rental taxes in Maricopa County, Ariz.

In a letter written on Feb. 17 by Bob Barton, president of ACRA, to the Arizona Republic he argues against the proposed fee increase. “HR 2453 has zero federal fiscal impact and would simply grandfather all the car rental taxes in existence today and create a prohibition on all future discriminatory car rental taxes,” he wrote.

Funds earned from the tax increase would help pay for a new Cactus League ballpark for the Chicago Cubs in Mesa. In addition to the increase on car rental taxes, the bill calls for an 8 percent ticket surcharge on all spring training baseball games to help fund the $84 million stadium.

The taxes initially would fund the Cubs stadium, but they could be used to help finance other Cactus League ballparks, Mesa Mayor Scott Smith said.

The nonprofit group, Americans for Tax Reform, said the proposed fee would negatively affect Arizonans and the local economy.

“Given the fact that replacement vehicles represent the majority of the car rental business, this tax increase would be paid mostly by Arizona residents. … HB 2736 will lead to reduced demand for rental cars and likely not meet revenue projections,” wrote Americans for Tax Reform’s Patrick Gleason.

Government watchdog, the Goldwater Institute, also pointed out that the proposed tax increase could violate the Arizona constitution.

“Adopting these taxes to benefit a single sports franchise may constitute an illegal special law under the Arizona Constitution. The proposed bill would confer to a sports authority such unbounded power that it may be an improper delegation of legislative authority, which also presents constitutional problems,” wrote Clink Bolick, director of the Goldwater Institute.

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