Hawaiian Business Advocacy Group Opposes Car Rental Tax Hike

In a document submitted to Hawaii House Transportation Chair Joe Souki, Small Business Hawaii, a small business advocacy organization, oppose SB 698 SD 3, which would increase charges for U-drives and tour buses and place money into the general fund, as opposed to improving highways or airports, according to the Hawaii Reporter.

Presently, the daily car rental tax is $3, which went up from $2 several years ago. According to organization, the amount of the proposed increase is unknown; however, some lawmakers are considering increasing daily car rental tax to as much as $8 a day. Additionally, protestors of the bill said that the language of the bill illustrates that the rental tax would not go towards fixing highways or the airports; rather, the money would go into the general fund.

The original tax increase was supposed to sunset in 2008, but the legislature removed the sunset provision and made the increase permanent.

In addition to tourists, local residents who rent vehicles for vacations, business trips or while their car is being repaired will also be impacted by the increase.

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