Phoenix Rental Companies Challenge $34M in Taxes

The rental car taxes were helping to make debt payments on the University of Phoenix football stadium. Photo via Wikimedia/Cygunusloop99
The rental car taxes were helping to make debt payments on the University of Phoenix football stadium. Photo via Wikimedia/Cygunusloop99

Rental car companies are looking to get a refund of a tax collected by the city of Phoenix, according to a report by the Associated Press. These rental companies won a court order for the return of about $150 million in taxes from a fund that pays for the University of Phoenix stadium.

The Arizona Sports and Tourism Authority depends on revenue from the 3.25% rental car tax to make debt payments on the University of Phoenix stadium as well as to promote tourism and pay for Cactus League stadiums.

The rental companies are seeking a refund of money that they have paid in sales taxes over the past four years, according to the report. An Arizona judge ruled that the rental car tax went against a state constitutional provision. Taxes imposed on the use of vehicles — on public streets — are restricted to funding road construction, maintenance, and related purposes.

Three rental companies are involved and paid about $200,000, but the city of Phoenix has collected more than $34 million from its rental car tax since 2012, according to the report.

The claim was filed last week for the companies by attorney Shawn Aiken. The claim could expand into a class-action case, says the report.

Click here for the full Associated Press report.

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