Virginia Operators Knock Back Sales and Use Tax

Posted on February 20, 2013

RICHMOND, Va. -- The Virginia Limousine Association recently beat back another attempt by the state to levy a five percent sales and use tax on ground transportation in Virginia. The proposed bill would have eliminated the sales tax exemption extended to certain services, such as auto repairs, taxi and limousines, armored cars, travel, and transportation.

Due to VLA opposition, the bill failed to be voted out of the House of Delegates Committee on Finance last week. VLA president Glenn Stafford attributed the success to a team effort between the NLA, VLA, and especially the participation of membership.

“We sent out notice of this and Philip Jagiela, [executive director of the National Limousine Association], was instrumental in helping us craft the letter to send to representatives,” Stafford said. “We had a large, large majority of membership who emailed their delegates and then we followed up with some personal visits at the legislature.”

Of course, on top of the actual 5% tax increase are the administrative costs of collecting and reporting, which might cost an additional quarter of a percent to handle, said VLA vice president Dan Goff. “We’re always on the defense of our operator members, and in this case, this would have hurt our members in Virginia, in some cases, thousands of dollars a year. I lived in Florida when they implemented the services tax, and while it certainly brought extra revenue for the state, it was devastating for small businesses, just devastating.”

Goff credited the win to organizing membership to act en mass, Stafford’s legislative savvy and the leverage that members have as employers with state representatives in their respective districts, particularly, Delegate Rob Bell, R-58th District (Albemarle County).

Stafford and Goff expect the issue of use tax to keep popping as states are cash strapped and the industry is seen as an easy target. “We are always trying to stand up for our member and keep unfair things to a minimum,” Goff said. “The government does a great job of providing us with roads and basic regulation. But at some point the cost benefit can tip the wrong way and we’re here to keep that from happening.”

“I’m sure it will because they’re looking for ways to get in our pockets all the time,” Stafford said.

This victory comes on the heels of another recent win, as the VLA, in concert with the Maryland Limousine Association, Washington Metropolitan Limousine Association, and the NLA succeeded in reducing the fee for limousine operators providing service during Presidential Inauguration weekend from $500 to $150 per vehicle.  

“That reduction in inaugural fees and this knock back of a 5% tax on ground transportation both are important to get out to membership of various associations, national and state, as to what the associations do for them that help justify the fees,” Goff said.

— Denis Wilson, LCT East Coast Editor

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