Regulations

New York Operators Fight Sales Tax

Denis Wilson
Posted on August 10, 2013
Towne Livery’s David Bastian, a member of the Limousine Bus Taxi Operators of Upstate New York, was instrumental in getting a proposed repeal of the state sales tax on limousine service well into the state legislative process.

Towne Livery’s David Bastian, a member of the Limousine Bus Taxi Operators of Upstate New York, was instrumental in getting a proposed repeal of the state sales tax on limousine service well into the state legislative process.

Towne Livery’s David Bastian, a member of the Limousine Bus Taxi Operators of Upstate New York, was instrumental in getting a proposed repeal of the state sales tax on limousine service well into the state legislative process.
Towne Livery’s David Bastian, a member of the Limousine Bus Taxi Operators of Upstate New York, was instrumental in getting a proposed repeal of the state sales tax on limousine service well into the state legislative process.

If you’ve tuned in to LCT E-News in the last few months, you probably noticed recurring coverage of a push by operators in New York to repeal the state sales tax on limousine service. This issue is newsworthy for several reasons: Sales taxes affect the bottom lines of every operator in New York; operators in other states also contend with sales taxes; and the battle offers some lessons in successful lobbying.

The tax became law in 2009 when it was included in that year’s state budget. The criticism is that the “hidden” tax was unfairly imposed on the limousine and black car services, while exempting other vehicles, such taxis and buses. The tax varies by county; in New York City, for example, the tax is 8.85%.

David Bastian, general sales manager of Towne Livery in Orchard Park, N.Y., and a member of the Limousine Bus Taxi Operators of Upstate New York (LBTOUNY) legislative committee, has been leading the charge for his association. New to the lobbying game, Bastian says he’s learned a lot.

Always Ask
The first lesson is that you’ll never know until you ask. Trying to get the sales tax repealed has been discussed in several meetings but the association wasn’t sure whether they’d get any traction on the effort, Bastian says. He called up Sen. Mark Grisanti, R-60th District, and asked his office to consider the repeal.

“After they looked into it, they basically grabbed the ball and ran with it,” Bastian says. “I didn’t realize they would jump on it so fast. They really weren’t aware of this issue and how it affected the industry. When we told them about it, they felt it wasn’t right and they responded.”

Grisanti sponsored Bill S.4920 on May 1, and a similar bill was introduced into the State Assembly by Assemblyman Dennis H. Gabryszak, D-143rd District. With the legislative session ending June 21, things moved quickly from there. “I didn’t have much time to prepare. It was basically learning how to lobby on the fly. It was like a whirlwind for a month.”
Befriend Staffs

A second lesson is that legislative staffs are important players, so don’t write them off. When Bastian contacted various legislators, he admits he viewed staff as an obstacle to getting to actual lawmakers and was concerned the word was not making it up the chain of command. He soon learned otherwise. “When you make a call to a legislator’s office, the staff you talk to are the ones [who] do the homework and play an important role in getting information to the Assemblyman or Senator to understand the situation so they can make an informed decision.”

Unity
A key component of the repeal strategy was unifying New York operators and supporters. A lack of such unity allowed the law to be passed in the first place, Bastian says. “They weren’t talking and they weren’t discussing the issues. It left them vulnerable and in a position where they couldn’t fight it.” LBTOUNY formed a close working relationship with Ira Goldstein and the Black Car Assistance Corp. Their combined membership meant more constituents reaching out to lawmakers, which is what elected officials care about. LBTOUNY also worked with the Coalition of Transportation Associations, Limousine Association of New York, the NLA, Long Island Limousine Association, the Minority Limousine Operators of America (MLOA), as well as trade unions. Going forward, LBTOUNY plans on having a monthly conference call with the BCAC so they can keep momentum going on the repeal and other issues that come up.
 
“In 2009, the taxi and bus operators both got exempt from this because they had stronger lobbying,” said Kevin Barwell of Giorgio’s Limousine in Buffalo and LBTOUNY President. They had stronger roots to get these exemptions. Our industry wasn’t as strong at the time. Even at a national level, we weren’t as strong as we are today. Dawson Rutter [Commonwealth Worldwide of Boston] has done an incredible job this year with the PAC fund.”

Word Out
Like any grassroots action, the crux of the repeal effort has been mobilizing owners and operators to act. Social media, emails, newsletters, and industry trade media all have been harnessed to get the word out. It helped get the bills sponsored, and as the bills have moved through each committee, industry members were encouraged to write emails and letters, make phone calls, and sign petitions. They also formed a coalition of like-minded groups called United New York, with a website where pre-written emails can be sent to any Assembly or Senate members.
 
The fact is that the tax generates millions of dollars in revenue. States are looking for creative ways to generate more tax revenue, not cut it. So as much as any lawmaker might agree with the repeal, the lost revenue needs to be made up somewhere. For this reason, New York operators are optimistic that the bill will fare better when the legislature starts again in January 2014, when budgets are set for the coming year. The repeal supporters are using this time to regroup and grow support among operators and lawmakers, who may sign on as co-sponsors.
 
Supporters justify the ban by arguing that the tax puts an uneven, undue burden on the limo and black car industry, which is comprised mostly of small businesses. New York is marketing itself as a small business-friendly state, complete with an “Open for Business” PR campaign. Repeal of the sales tax for limousine service would make that phrase more than just a slogan.

Related Topics: David Bastian, Eastern U.S. Operators, industry politics, LBTOUNY, legislation, limo associations, New York operators, sales taxes, tax repeal

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