Green cars could get sales tax cut

by John Seiler | March 7, 2015 5:36 am

Green cars could get a sales tax cut under Assembly Bill 945[1], by Assemblyman Bill Ting, D-San Francisco. According to his website[2], the bill is:

“Aimed at boosting electric vehicle sales to meet California’s climate and air quality goals through reducing state sales taxes associated with the purchase of zero-emission and other clean vehicles. …

“Ting’s Assembly Bill (AB) 945 exempts the purchase of cars powered by electricity, compressed natural gas and hydrogen fuel cells or plug-in hybrid cars from the state’s share of sales tax.  Instead of facing the 7.5 percent state sales tax rate, new purchases would face a sales tax of 3.06 percent.”

However, the legislative summary [3]of the bill notes why it will face opposition from cities and counties:

“Section 2230 of the Revenue and Taxation Code provides that the state will reimburse counties and cities for revenue losses caused by the enactment of sales and use tax exemptions.

“This bill would provide that, notwithstanding Section 2230 of the Revenue and Taxation Code, no appropriation is made and the state shall not reimburse any local agencies for sales and use tax revenues lost by them pursuant to this bill.

“This bill would take effect immediately as a tax levy.”

Local governments still are upset that Gov. Jerry Brown and the Legislature forced them to pick up the cost of prison realignment [4]to relieve state prison overcrowding. In that case, the reason was the acute state budget crisis and federal courts ordering a reduction in state prisoners.

However, according [5]to the Los Angeles Times, Ting believes the lost money could be made up from the state’s cap-and-trade program. But other state programs also are trying to claim that money, including Gov. Jerry Brown’s proposal [6]to use it to fund the high-speed rail project.

Another objection will be that green cars already get rebates [7]of up to $7,500 from the federal government. And they benefit from the California Clean Vehicle Rebate Project, which the California Environmental Protection Agency describes:

“The Air Resources Board (ARB) Clean Vehicle Rebate Project (CVRP) is designed to promote the purchase of battery electric, plug-in hybrid electric, and fuel cell vehicles.  Rebates of up to $5,000 per light-duty vehicle are available for individuals, nonprofits, government entities, and business owners who purchase or lease an eligible vehicle. For current rebate statistics, please visit the Center for Sustainable Energy’s (CSE)  CVRP Rebate Statistics Webpage[8].”

Source URL: https://calwatchdog.com/2015/03/07/green-cars-could-get-sales-tax-cut/

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