MORE NIBBLES: Operators Battle Stifling Sales Taxes

Posted on July 15, 2009 by LCT Staff - Also by this author - About the author

NEW YORK — As LCT previously reported in last week’s Driving Force, sales taxes on luxury transportation service are looking attractive to many states that face a budget crisis.

New York operators were dealt yet another blow. The state sales tax on service which they only began collecting in June has been increased by another .5 %. Operators in New York City who collect 8.375% will collect 8.875% if the governor signs the bill which awaits his signature. If signed, operators will be required to begin collecting the additional .5% within 10 days.

As New York operators reel under the tax, operators in North Carolina are trying to forestall the latest government revenue grab on limos. The North Carolina Limousine Association is waging a letter writing campaign to their state representatives in order to fight the tax being proposed by the governor. The association is also formulating plans to continue to tackle the issue in order for the limousine industry to be exempted from the tax. Operators in North Carolina are now exempted from sales tax on service.

As governments look to the chauffeured transportation industry for additional revenue streams to fund budgets, operators will begin to see just how much of this burden consumers are willing to bear before they say enough and no longer use such services.

The industry faces mounting burdens with the sales tax efforts, the recession, negative media images spurred by anti-business-travel politicians, and bottom feeder operators, along with illegals, undercutting the market with slashed prices.

Source: Linda Moore, LCT Magazine

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