The Truth About Cars » Taxes http://www.thetruthaboutcars.com The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. Sun, 30 Aug 2015 16:08:02 +0000 en-US hourly 1 http://wordpress.org/?v=4.2.4 The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars no The Truth About Cars editors@ttac.com editors@ttac.com (The Truth About Cars) 2006-2009 The Truth About Cars The Truth About Cars » Taxes http://www.thetruthaboutcars.com/wp-content/themes/ttac-theme/images/logo.gif http://www.thetruthaboutcars.com/category/news-blog/taxes/ Union Leader Blasts Obama on Pacific Trade Talks http://www.thetruthaboutcars.com/2015/08/union-leader-blasts-obama-pacific-trade-talks/ http://www.thetruthaboutcars.com/2015/08/union-leader-blasts-obama-pacific-trade-talks/#comments Wed, 26 Aug 2015 21:00:30 +0000 http://www.thetruthaboutcars.com/?p=1153377 The head of the AFL-CIO in the United States is criticizing the current presidential administration for its pursuit of a trade zone in the Pacific that could open up Asian markets to America and vice versa, the Detroit News is reporting. AFL-CIO President Richard Trumka wrote the administration a letter saying that a free-trade agreement with […]

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Trans-Pacific Partnership Circa 2010

The head of the AFL-CIO in the United States is criticizing the current presidential administration for its pursuit of a trade zone in the Pacific that could open up Asian markets to America and vice versa, the Detroit News is reporting.

AFL-CIO President Richard Trumka wrote the administration a letter saying that a free-trade agreement with countries such as Japan jeopardizes American jobs because those countries may be able to source cheaper parts from outside the negotiated area, according to the report.

“I hope it is not the case that the Canadian and Mexican negotiators are actually holding a harder line than our own government on this issue. But due to the unaccountable lack of transparency from USTR, absolutely critical decisions are being made without our input or voice. Thousands of good American jobs and an iconic American industry are at risk, and we don’t even know what our government’s negotiating position is.”

According to the Detroit News, a free-trade agreement with Asia would be high on Obama’s priorities before his administration ends.

Trumka said there would be no guarantee for American automakers to gain a foothold in Japan if the Trans Pacific Partnership were created.

Instead, he said, the deal would make it easier for American automakers to source cheaper parts from China and Thailand, or other developing nations, which would come at the expense of American auto workers. Under current free trade rules in North America, 62.5 percent of a car or light truck must originate within the trade zone to be tariff free. Mexico, which is currently building nearly 4 million cars a year, would like to increase that to 65 percent. Japan is proposing a 45-percent threshold for vehicles and 30 percent for parts.

The agreement could also end the 25-percent import tax on light pickups, commonly called the “Chicken Tax.”

Automakers have said they’d prefer to renew the Chicken Tax or slowly roll the tax back after years — or even decades.

According to the story, Japan doesn’t place any import tax on American-built cars, and has said they’ve spent billions building production facilities in America — which American automakers haven’t yet done in Japan.

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Senate Committee Approves Bill to Help Detroit Make Hybrids http://www.thetruthaboutcars.com/2015/07/senate-committee-approves-bill-help-detroit-make-hybrids/ http://www.thetruthaboutcars.com/2015/07/senate-committee-approves-bill-help-detroit-make-hybrids/#comments Thu, 30 Jul 2015 21:00:58 +0000 http://www.thetruthaboutcars.com/?p=1129497 A U.S. Senate committee for transportation passed along a bill Thursday that included provisions to help domestic automakers develop and build cleaner vehicles, the Detroit News is reporting. The proposal, dubbed the Vehicle Innovation Act, was included in a larger clean energy bill taken up by the committee. The Vehicle Innovation Act would set aside […]

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Chevrolet_Tahoe_Hybrid_O'Malley_--_01-12-2010

A U.S. Senate committee for transportation passed along a bill Thursday that included provisions to help domestic automakers develop and build cleaner vehicles, the Detroit News is reporting.

The proposal, dubbed the Vehicle Innovation Act, was included in a larger clean energy bill taken up by the committee. The Vehicle Innovation Act would set aside $313.6 million next year for research and development of hybrid technology, battery development and alternative fuels such as natural gas. Funding would increase by 4 percent every year up to 2020.

Nearly all major U.S. automotive lobbies representing manufacturers supported the proposal.

The proposal, which will now head to the Senate, faces an extremely difficult future. The bipartisan bill, which was sponsored by Lamar Alexander (R-Tenn.), and Michigan Democrat Sens. Gary Peters and Debbie Stabenow, may be a long shot in the Republican-controlled House — if it makes it that far.

Separately, a bill that Peters introduced that would allow states to use highway funding to help advance road-to-vehicle communications, passed the Senate as part of a larger transportation package. The bill, called the Vehicle-to-Infrastructure Safety Technology Investment Flexibility Act of 2015 says what it does and does what it says will be part of the Senate’s larger 6-year highway funding package.

Along with the Vehicle Innovation Act, the “smart road” provision and larger funding bill won’t be taken up by the House anytime soon. Congress is working toward a 3-month stopgap measure and will take up the larger spending packages after its August recess.

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Car Building in Ontario Could Die, and They Probably Can’t Save It http://www.thetruthaboutcars.com/2015/07/car-building-ontario-die-probably-cant-save/ http://www.thetruthaboutcars.com/2015/07/car-building-ontario-die-probably-cant-save/#comments Mon, 27 Jul 2015 21:00:15 +0000 http://www.thetruthaboutcars.com/?p=1125985 Ontario’s debt is swelling and as home to eight manufacturing plants — the largest complex in North America — automakers may have a tough time keeping plants open in Canada’s most-populous province. According to a story by the Financial Post, Ontario is moving forward with an ambitious plan to revamp roads and mass transit systems despite its debt being downgraded […]

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Chrysler Brampton Assembly Plant

Ontario’s debt is swelling and as home to eight manufacturing plants — the largest complex in North America — automakers may have a tough time keeping plants open in Canada’s most-populous province.

According to a story by the Financial Post, Ontario is moving forward with an ambitious plan to revamp roads and mass transit systems despite its debt being downgraded by Standard & Poor’s bond index. The broad public spending plan also extends to other sectors, despite high unemployment numbers and slumping manufacturing jobs.

Automakers such as Fiat Chrysler Automobiles have called on the provincial government to cut back on public programs and reduce costs on utilities in an effort to keep car building in the province profitable. This year, Chevrolet will shift production of its Camaro to Michigan. On the whole, Oshawa GM production has a dark cloud lingering overhead until the company decides what to do with the facility in 2016.

Ontario’s debt is twice that of California’s with only half the population, the Financial Post reported.

Last month the province reported that 5,200 manufacturing jobs left the region, which prompted local business leaders to sign a petition asking the government to reconsider its proposed pension plan that FCA CEO Sergio Marchionne said this month could hamper growth.

“We’re fully aware of the fact that this proposal on pensions and cap and trade and all this stuff … these are all things that add cost to the running of operations, they don’t come for free,” Marchionne said, according to the Toronto Sun.

Already, automakers such as Volvo and Land Rover have turned down Ontario in favor of operations in the United States and it’s unclear if swelling debt and rising costs of operation will cost the province more jobs in the future.

Other automakers that already have facilities in Ontario are making changes. Honda and Ford are both positioning their plants to manufacture vehicles for export markets. Toyota, on the other hand, will end Corolla production in Ontario in favor of Mexico. The company stated it will “switch from producing Corollas to mid-sized, higher-value vehicles” at their Canadian plant. The replacement product has not yet been announced.

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Sales of EVs, Hybrids Slumping After Gas Prices Dip http://www.thetruthaboutcars.com/2015/07/sales-evs-hybrids-slumping-gas-prices-dip/ http://www.thetruthaboutcars.com/2015/07/sales-evs-hybrids-slumping-gas-prices-dip/#comments Thu, 02 Jul 2015 16:00:00 +0000 http://www.thetruthaboutcars.com/?p=1105913 Sales figures from automakers this week show slumping sales of electric vehicles and hybrids nationwide as gas prices drop and tax incentives dry up. According to the Detroit News, sales from EV makers such as Nissan and Chevrolet have slowed down significantly — more than 30 percent for the Volt and 12 percent for the Leaf […]

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Atlanta Police Nissan Leaf

Sales figures from automakers this week show slumping sales of electric vehicles and hybrids nationwide as gas prices drop and tax incentives dry up.

According to the Detroit News, sales from EV makers such as Nissan and Chevrolet have slowed down significantly — more than 30 percent for the Volt and 12 percent for the Leaf — last month, and both models may end up down significantly for the sales year.

Hybrid carmakers such as Ford and Honda are also reporting slow sales for their cars. Ford reported that its hybrid sales were down 29 percent over the last five months, and Honda reported a 15-percent drop in June.

Industry analysts say the slowdown could be a result of the lowest gas prices in five years, and a adjustment of states’ EV incentives. Recently, the California Air Resources Board unveiled a tiered incentive program that would adjust rebates based on income. A study showed that more than one in four EV buyers in California earned more than $200,000 a year, but still received the full benefit during the second quarter of 2015. More than three-quarters of EV buyers made more than $99,000. Georgia will end its incentives.

None of this has slowed down automakers’ production of EVs, however.

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Republican Hopeful Donald Trump Threatens Ford With Tariffs Over Mexico http://www.thetruthaboutcars.com/2015/06/republican-hopeful-donald-trump-threatens-ford-with-tariffs-over-mexico/ http://www.thetruthaboutcars.com/2015/06/republican-hopeful-donald-trump-threatens-ford-with-tariffs-over-mexico/#comments Thu, 18 Jun 2015 19:00:49 +0000 http://www.thetruthaboutcars.com/?p=1095409 Republican presidential hopeful and billionaire Donald Trump wants to bring the pain via punitive tariffs to Ford for manufacturing vehicles in Mexico. During his announcement of his 2016 campaign Tuesday, The Detroit News says Trump vowed he would levy a 35 percent tariff on Ford parts and vehicles imported from Mexico if the automaker presses […]

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Smug Motherfucker Donald Trump Douching It Up Like He Always Does

Republican presidential hopeful and billionaire Donald Trump wants to bring the pain via punitive tariffs to Ford for manufacturing vehicles in Mexico.

During his announcement of his 2016 campaign Tuesday, The Detroit News says Trump vowed he would levy a 35 percent tariff on Ford parts and vehicles imported from Mexico if the automaker presses forward with a $2.5 billion investment in the nation, claiming the move would “take away thousands” of jobs from American workers.

Trump then proceeded to roleplay how he would deliver the “bad news” to “the head of Ford,” CEO Mark Fields:

Let me give you the bad news: every car, every truck and every part manufactured in this plant that comes across the border, we’re going to charge you a 35 percent tax — OK? — and that tax is going to be paid simultaneously with the transaction. They are going to take away thousands of jobs.

Announced in April, the $2.5 billion investment would add 3,800 jobs to the 11,300 already employed by Ford in Mexico, and would include new engine and transmission plants aimed toward the export market in the United States and other global markets.

Trump continued on with his roleplay, stating Ford would use lobbyist power to persuade “President Trump” to drop the tax, only for him to sandbag the automaker into submission. He added he knew Fields personally, and thought Ford was a good company overall.

In response, spokeswoman Christin Baker reiterated Ford’s investments into its home market:

We are proud that we have invested $6.2 billion in our U.S. plants since 2011 and hired nearly 25,000 U.S. employees. Overall, 80 percent of our North American investment annually is in the U.S., and 97 percent of our North American engineering is conducted in the U.S.

Of course, Trump wouldn’t be legally able to punish Ford for building its plants wherever it wanted, let alone single-out Ford with his plan without also doing the same to General Motors and FCA (how he would deal with Fiat owning Chrysler would be a whole other round of metaphors and hyperbole altogether).

At least one thing is for certain in Trump’s campaigning thus far: the dead cat on his head is actually his hair.

(Photo credit:Gage Skidmore/Flickr/CC BY-SA 2.0)

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Colorado Offers Tax Credits On Used EVs, PHEVs http://www.thetruthaboutcars.com/2015/05/colorado-offers-tax-credits-on-used-evs-phevs/ http://www.thetruthaboutcars.com/2015/05/colorado-offers-tax-credits-on-used-evs-phevs/#comments Wed, 13 May 2015 18:00:12 +0000 http://www.thetruthaboutcars.com/?p=1067546 Shopping for a used PHEV or EV in Colorado? You still may be able to take a tax credit, thanks to the state’s structuring of its EV purchase tax credit. The credit — up to $6,000 — can be applied to used PHEV or EV purchases so long as it wasn’t claimed already via VIN […]

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Tesla Roadster In Colorado Showroom Circa August 2011

Shopping for a used PHEV or EV in Colorado? You still may be able to take a tax credit, thanks to the state’s structuring of its EV purchase tax credit.

The credit — up to $6,000 — can be applied to used PHEV or EV purchases so long as it wasn’t claimed already via VIN registration, Green Car Reports says. Though most Colorado-based offerings likely already have the credit cashed-in, out-of-state imports are the biggest beneficiaries.

Per an anonymous source, a Colorado resident could purchase a vehicle registered out-of-state for at least three years after originally leaving the lot, then bring the car back home to register its VIN as used in Colorado, legally claiming the credit on their next tax return in so doing.

According to the publication, the used PHEV/EV credit is the only one of its type in the United States, as the focus of tax incentives is on new vehicles.

[Photo credit: Eric Lumsden/Flickr/CC BY-ND 2.0]

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Biggest Supplier of U.S. Foreign Oil Elects Democratic Socialist Government http://www.thetruthaboutcars.com/2015/05/biggest-supplier-u-s-foreign-oil-elects-democratic-socialist-government/ http://www.thetruthaboutcars.com/2015/05/biggest-supplier-u-s-foreign-oil-elects-democratic-socialist-government/#comments Wed, 06 May 2015 13:27:12 +0000 http://www.thetruthaboutcars.com/?p=1062762 Last night, it became official: Alberta, the largest producer of oil in Canada, ended the 40 year reign of the Progressive Conservatives in favor of the New Democratic Party (NDP), a democratic socialist party. This could mean big changes in the energy sector, from oil patch to gas pump. The Alberta NDP, under the leadership of […]

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Rachel Notley, Alberta NDP Leader

Last night, it became official: Alberta, the largest producer of oil in Canada, ended the 40 year reign of the Progressive Conservatives in favor of the New Democratic Party (NDP), a democratic socialist party.

This could mean big changes in the energy sector, from oil patch to gas pump.

The Alberta NDP, under the leadership of new premier Rachel Notley, campaigned on a promise to review energy royalties. With the previous government known for charging royalties far below average, it’s likely a review will find an increase favorable for Albertans. And, as is the case, customers will be footing the bill and the energy lobby has already come out swinging.

From CBC:

Altacorp Capital, a Calgary investment bank that is partly owned by the provincial government, expressed a similar view in a report earlier this week, before the election.

The report pointed out that energy investors, especially those based outside of Canada, have lots of options when it comes to investing.

“Unfortunately, with Alberta possibly heading for a third royalty change in eight years now, we believe global investors will add a degree of caution with the province’s ability to maintain a stable investable environment.”

Other platform promises including raising corporate income tax rates from 10 to 12 percent, increasing the minimum wage to $15 per hour by 2018, more tax brackets and higher taxes for making over $125,000 per year, and a ban on corporate and union political donations.

Canada is the largest outside supplier of petroleum to the United States at 3.39 million barrels per day, 37 percent of gross imports, more than all OPEC countries combined in 2014.

[Image source: Rachel Notley Facebook Page]

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Obama Budget Proposes Tax On Corporate Foreign Earnings For Roads http://www.thetruthaboutcars.com/2015/02/obama-budget-proposes-tax-corporate-foreign-earnings-roads/ http://www.thetruthaboutcars.com/2015/02/obama-budget-proposes-tax-corporate-foreign-earnings-roads/#comments Tue, 03 Feb 2015 11:00:49 +0000 http://www.thetruthaboutcars.com/?p=992842 President Barack Obama unveiled his annual budget Monday, which includes a proposition to tax corporate foreign earnings to fund the nation’s roads. Vox reports the proposal would levy a one-time tax on 14 percent of foreign earnings held by U.S. corporations, pulling in $238 billion to help supplement taxes collected at the pump. The collected […]

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Syracuse Road Construction - Utah DOT

President Barack Obama unveiled his annual budget Monday, which includes a proposition to tax corporate foreign earnings to fund the nation’s roads.

Vox reports the proposal would levy a one-time tax on 14 percent of foreign earnings held by U.S. corporations, pulling in $238 billion to help supplement taxes collected at the pump. The collected taxes would then be distributed into road infrastructure projects at a rate of $79.7 billion per year over the next six years, totalling $478 billion.

Meanwhile, Sens. Rand Paul of Kentucky and Barbara Boxer of California have both offered a “repatriation holiday” to said corporations, giving the latter a tax rate of 6.75 percent over five years on foreign earnings brought back to the United States. The taxes would then go into those projects.

However, such holidays have been frowned upon by Obama over his two terms, warning that corporations would lobby Congress for more tax holidays; the Joint Committee on Taxation found such holidays would lose money over a decade despite the short-term gain.

Another option, proposed by Rep. John Delaney of Maryland, would tax corporate foreign earnings at a rate of 8.75 percent while ending deferrals. The bill would collect $170 billion to be spent on roads for six years.

Whatever happens, a decision would have to be made within the next few months. The U.S. Highway Trust Fund will go empty once again if nothing is done by May 31 of this year, forcing Congress to make do with the gas taxes collected. Since most people are driving less and using more fuel-efficient vehicles to get around these days, those taxes — which haven’t been raised above 18.4 cents/gallon since 1993 — fall short of the $50 billion per year needed for infrastructure; the current rate is of collection is $34 billion/year.

Two options have been proposed to fix the main issue — increase the gas tax and then pegging it to inflation, or expand drilling on federal lands and collecting the royalties — but neither option is popular among most in the Beltway.

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113th US Congress Leaves $8K Hydrogen Credit On The Table http://www.thetruthaboutcars.com/2014/12/113th-us-congress-leaves-8k-hydrogen-credit-table/ http://www.thetruthaboutcars.com/2014/12/113th-us-congress-leaves-8k-hydrogen-credit-table/#comments Tue, 23 Dec 2014 11:00:01 +0000 http://www.thetruthaboutcars.com/?p=964370 For the few who will be purchasing a Toyota Mirai in 2015, you may be out of luck as far as tax savings are concerned. For now, anyway. Autoblog reports the 113th U.S. Congress has called it a day without renewing an $8,000 tax credit for hydrogen vehicles entered into service after December 31, 2005, […]

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For the few who will be purchasing a Toyota Mirai in 2015, you may be out of luck as far as tax savings are concerned. For now, anyway.

Autoblog reports the 113th U.S. Congress has called it a day without renewing an $8,000 tax credit for hydrogen vehicles entered into service after December 31, 2005, and purchased before the same date in 2014. The credit is among other credits that didn’t get the once-over from Congress, who were busy looking over — and renewing a few of — credits from 2013.

That said, Honda wants the credit brought back in time for its FCV’s U.S. showroom arrival in 2016, the next concept version of which is set to bow at the 2015 Detroit Auto Show January. Robert Beinefeld, assistant vice president of the automaker’s Environment and Energy Policy, says his employer is working with “many partners on the legislative front to address this situation,” in the belief that legisators don’t intentionally pick “winners and losers by providing tax credits to some technologies and not others.”

As for Hyundai, whose Tucson Fuel Cell entered Californian showrooms earlier this summer, a representative didn’t give any further comment on the hydrogen credit as of this writing.

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MBUSA Looking South For New Home http://www.thetruthaboutcars.com/2014/12/mbusa-looking-south-new-home/ http://www.thetruthaboutcars.com/2014/12/mbusa-looking-south-new-home/#comments Thu, 18 Dec 2014 15:00:40 +0000 http://www.thetruthaboutcars.com/?p=962394 With Cadillac getting its inner hipster on in SoHo, and Subaru trekking four miles west to conduct its American hustle in Camden, N.J., Mercedes-Benz USA is feeling the urge to heed the song of the South and go with the wind. Automotive News reports MBUSA is looking at relocating its 800 employees to either Georgia, […]

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Mercedes-Montvale-hq-a

With Cadillac getting its inner hipster on in SoHo, and Subaru trekking four miles west to conduct its American hustle in Camden, N.J., Mercedes-Benz USA is feeling the urge to heed the song of the South and go with the wind.

Automotive News reports MBUSA is looking at relocating its 800 employees to either Georgia, Florida or North Carolina, leaving Montvale, N.J. after 42 years. Representatives for the company wouldn’t confirm or deny the plans, believing it to be nothing more than rumor and speculation.

The company is currently looking over tax incentive packages, with New Jersey working on its own package in the hope of keeping MBUSA’s headquarters in Montvale. JLL Inc., the commercial real estate firm that is helping Toyota move its U.S. headquarters to Texas from California, is also lending assistance to the company.

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Ferrari May Follow FCA Out Of Italy For Fiscal Reasons http://www.thetruthaboutcars.com/2014/12/ferrari-may-follow-fca-italy-fiscal-reasons/ http://www.thetruthaboutcars.com/2014/12/ferrari-may-follow-fca-italy-fiscal-reasons/#comments Thu, 11 Dec 2014 14:00:50 +0000 http://www.thetruthaboutcars.com/?p=958433 Just as Fiat Chrysler Automobiles left Italy to escape the tax man, Ferrari is considering the same as it moves closer to leaving the nest by next October. Bloomberg reports the automaker is also considering remaining in Maranello, though a change in its fiscal address wouldn’t affect manufacturing and engineering operations. A final decision either […]

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Just as Fiat Chrysler Automobiles left Italy to escape the tax man, Ferrari is considering the same as it moves closer to leaving the nest by next October.

Bloomberg reports the automaker is also considering remaining in Maranello, though a change in its fiscal address wouldn’t affect manufacturing and engineering operations. A final decision either way could come in the next few months, per the publication’s anonymous sources.

Such a move would prove devastating to Italy beyond the nation’s economy, as Ferrari is considered a national treasure. Milan Bicocca University professor of public finance Ugo Arrigo said the move would show investors and companies alike that the country and its fiscal system as uncompetitive; Italy’s corporate rate is 31.4 percent, whereas the United Kingdom — where FCA calls its fiscal home — has a rate of 21 percent, soon to be 20 percent.

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Sen. Reid Calls Upon Congress To Raise EV Tax Incentives http://www.thetruthaboutcars.com/2014/10/sen-reid-calls-upon-congress-raise-ev-tax-incentives/ http://www.thetruthaboutcars.com/2014/10/sen-reid-calls-upon-congress-raise-ev-tax-incentives/#comments Wed, 01 Oct 2014 10:00:16 +0000 http://www.thetruthaboutcars.com/?p=922273 For the past three years, President Barack Obama has called upon Congress to raise tax incentives for electric vehicles from $7,500 to $10,000, with those calls going unanswered. This year, the top Democrat in the U.S. Senate is taking the charge. The Detroit News reports Senate Majority Leader Henry Reid of Nevada pushed Congress to […]

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Harry Reid

For the past three years, President Barack Obama has called upon Congress to raise tax incentives for electric vehicles from $7,500 to $10,000, with those calls going unanswered.

This year, the top Democrat in the U.S. Senate is taking the charge.

The Detroit News reports Senate Majority Leader Henry Reid of Nevada pushed Congress to boost the incentives — and, therefore, EV sales — proclaiming the government needed to do more to encourage sales:

In order to truly promote innovation, we must as a Congress create opportunities for consumers to invest in advanced technologies, and we haven’t done that yet. We need more tax incentives for that. In 2008, we encouraged America to invest in the growth of the electric car industry with tax credits for qualified electric vehicles.

The extra $2,500 would provide dealers an opportunity to claim credits so long as they disclosed that info to their customers, which would then give said customers a chance to claim the credits at the point of sale, instead of filing a claim with their taxes the following year.

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Bipartisan Senate Bill To Raise Fuel Taxes For The First Time Since 1993 http://www.thetruthaboutcars.com/2014/06/bipartisan-senate-bill-to-raise-fuel-taxes-since-1993/ http://www.thetruthaboutcars.com/2014/06/bipartisan-senate-bill-to-raise-fuel-taxes-since-1993/#comments Thu, 19 Jun 2014 13:00:59 +0000 http://www.thetruthaboutcars.com/?p=846921 For over two decades, the federal fuel tax has held at 18.4 cents for gasoline and 24.4 cents for diesel per gallon sold. A bipartisan bill working through the United States Senate could soon change this, especially as the nation’s Highway Trust Fund — used for funding infrastructure projects — comes closer to running dry […]

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gas-pump-save-ftr

For over two decades, the federal fuel tax has held at 18.4 cents for gasoline and 24.4 cents for diesel per gallon sold. A bipartisan bill working through the United States Senate could soon change this, especially as the nation’s Highway Trust Fund — used for funding infrastructure projects — comes closer to running dry by August of this year.

Reuters reports Sens. Bob Corker of Tennessee and Chris Murphy of Connecticut want to raise both taxes by 12 cents, which would be spread out over two years prior to linking future increases to inflation. The senators also proposed tax cuts to make up for the increase, though nothing was specified at the time.

Meanwhile, some legislators want to fund the trust through a corporate offshore profit tax repatriation holiday that would resemble a 2004 proposal led by former president George W. Bush: 12 months, 85 percent deduction for dividends paid. The Joint Committee on Taxation estimated the holiday would bring in $20 billion during the period, but would lead to expectations for more holidays down the road.

President Barack Obama opposes this method, believing “it would give large tax breaks to a very small number of companies that have most aggressively shifted profits, and in many cases, jobs, overseas,” according to White House representative Jay Carney.

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AAA: 51 Percent Surveyed Willing To Pay For Better Roads http://www.thetruthaboutcars.com/2014/06/aaa-51-percent-surveyed-willing-to-pay-for-better-roads/ http://www.thetruthaboutcars.com/2014/06/aaa-51-percent-surveyed-willing-to-pay-for-better-roads/#comments Thu, 12 Jun 2014 10:00:03 +0000 http://www.thetruthaboutcars.com/?p=842890 As those inside the Beltway debate how best to fund their responsibility for the nation’s transportation infrastructure, a AAA study finds most Americans would pay more taxes for better roads. Autoblog reports 67 percent of the 2,013 surveyed by AAA want the federal government to get it together and put more money into maintenance, with […]

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Carmageddon

As those inside the Beltway debate how best to fund their responsibility for the nation’s transportation infrastructure, a AAA study finds most Americans would pay more taxes for better roads.

Autoblog reports 67 percent of the 2,013 surveyed by AAA want the federal government to get it together and put more money into maintenance, with 52 percent in support of an increase in fuel taxes. Further, 51 percent surveyed would go as far as supporting a candidate who would support increases in funding for road maintenance and construction.

AAA CEO and president Bob Darbelnet added that many Americans were “willing to pay a little more” in taxes if the result led to “better roads, bridges and transit systems,” having become “fed up with record-long commutes, unsafe highways and never-ending potholes caused by political inaction.” In turn, the organization claims drivers would save $324 annually on road-related repairs for their vehicles.

AAA’s call to action comes under the potential threat of road work delays when the Highway Trust Fund — whose replenishment depends on the 18.3-cent/gallon gasoline and 22.4-cent/gallon diesel taxes that last saw an increase over 20 years ago — runs out of funds sometime this August. The Obama administration and a few members of Congress have offered solutions to the funding problem, but nothing more as come of them thus far.

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Abe Administration Pushes Automakers, Nation Away From Kei Cars http://www.thetruthaboutcars.com/2014/06/abe-administration-pushes-automakers-nation-away-from-kei-cars/ http://www.thetruthaboutcars.com/2014/06/abe-administration-pushes-automakers-nation-away-from-kei-cars/#comments Wed, 11 Jun 2014 11:00:09 +0000 http://www.thetruthaboutcars.com/?p=841985 For ages, the kei car has been one of the darlings of the automotive world, owing to its tiny size and equally tiny engine (that also netted owners a smaller tax bill). Alas, Japan’s littlest cars may soon be put in a toy box destined for Goodwill as the nation’s government puts the pressure on […]

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Nissan Moco

For ages, the kei car has been one of the darlings of the automotive world, owing to its tiny size and equally tiny engine (that also netted owners a smaller tax bill). Alas, Japan’s littlest cars may soon be put in a toy box destined for Goodwill as the nation’s government puts the pressure on both automakers and owners to move toward supporting bigger offerings.

The New York Times reports the Japanese government introduced three tax increases on kei owners, including a 50 percent boost in the kei car tax meant to bring their tax burden close to larger vehicles. Officials claim the cars are becoming a drain on the Diet’s coffers both on the tax and free trade fronts, and as they cannot be exported to other markets — college campuses withstanding — the keis are a waste of profit and R&D for automakers.

The Abe administration may see push back from owners and automakers alike, however. Smaller automakers such as Suzuki and Daihatsu use the R&D from their kei offerings to better compete in other markets where similar offerings are sold, as well as adding more content to make their cars more attractive to their local market base. Owners, meanwhile, opt for keis because of the low ownership costs involved, and the greater mobility offered in areas where mass transit is few and far between.

The tax increase on the kei has affected both parties, with automakers losing sales and owners who may decide not to buy any vehicle altogether; sales are expected to drop from 2.23 million in 2013 to 1.7 million in 2015.

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Michigan Legislators, Business Groups Debate Proposed Fuel Tax Hike http://www.thetruthaboutcars.com/2014/06/michigan-legislators-business-groups-debate-proposed-fuel-tax-hike/ http://www.thetruthaboutcars.com/2014/06/michigan-legislators-business-groups-debate-proposed-fuel-tax-hike/#comments Tue, 03 Jun 2014 11:00:22 +0000 http://www.thetruthaboutcars.com/?p=836073 State senators in Michigan returned to Lansing Monday in a rare session to discuss raising fuel taxes to fund improvements to the state’s road infrastructure. Detroit Free Press reports majority leader Randy Richardville of Monroe is proposing a new tax to replace the current fuel taxation scheme. At the moment, regular unleaded fuel is taxed […]

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May 2014 Michigan Gas Prices

State senators in Michigan returned to Lansing Monday in a rare session to discuss raising fuel taxes to fund improvements to the state’s road infrastructure.

Detroit Free Press reports majority leader Randy Richardville of Monroe is proposing a new tax to replace the current fuel taxation scheme. At the moment, regular unleaded fuel is taxed at 19 cents per gallon, while diesel sees 15 cents per gallon go to Lansing’s coffers. The new scheme would replace both taxes with a wholesale fuel tax, beginning at 9.5 percent next January, then rising to 15.5 percent by 2018. The tax will result in 25 cents per gallon sent to the government, raising an additional $1.5 billion annually to repair and maintain the state’s roads and bridges. Meanwhile, the state house wants to set a wholesale tax of just 6 percent, delivering $450 million a year.

Though Governor Rick Snyder is on board with Richardville’s proposal, business groups are split over the wholesale tax plan. The state chapter of the National Federation of Independent Business objects to the new tax, believing the tax could not come at a worse time as president Charlie Owen explains:

While we recognize the need for good roads and adequate funding, this is a difficult time for fuel tax increases on Michigan small-business job providers as we watch the price of gasoline approach $4 a gallon. The rising price of fuel and the recent increase in the minimum wage are already putting pressure on Michigan’s small and family-owned businesses. Raising the gas tax would cut more from their bottom line.

Michigan Chamber of Commerce Senior Vice President Jim Holcomb, however, sees no problem with the proposal because of the amount the tax would raise for road projects per annum. The chamber itself urged state lawmakers to solve the problem before facing the possibility of putting the question before the populace on the November 2014 ballot. If passed, the wholesale tax, in tandem with the state’s general sales tax, would give Michigan the title of having the highest fuel taxes in the United States, up from sixth place right now.

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Federal, State Governments Face Budget Shortfalls Amid Increased Fuel Efficiency http://www.thetruthaboutcars.com/2014/06/federal-state-governments-face-budget-shortfalls-amid-increased-fuel-efficiency/ http://www.thetruthaboutcars.com/2014/06/federal-state-governments-face-budget-shortfalls-amid-increased-fuel-efficiency/#comments Mon, 02 Jun 2014 10:00:27 +0000 http://www.thetruthaboutcars.com/?p=835537 As the funding aquifers for road maintenance continues to fall before the efficiency-fueled gas tax drought, federal and state governments are left to ponder how best to make up for the shortfall. Autoblog reports the easiest solution between the two parties is to raise gas taxes, though doing so could be construed as political suicide […]

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Chevy Volt Gas Station

As the funding aquifers for road maintenance continues to fall before the efficiency-fueled gas tax drought, federal and state governments are left to ponder how best to make up for the shortfall.

Autoblog reports the easiest solution between the two parties is to raise gas taxes, though doing so could be construed as political suicide at best. Thus, other solutions have come to the surface, including per-mile charges, increased sales taxes, fees for hybrids and EVs, tolling and closing tax loopholes. Without a way to recharge the aquifers, the CAFE drought would drain anywhere from $57 billion to $65 billion between 2012 and 2025; the Beltway Aquifer alone is facing complete drainage by this August.

Whatever the solution, there will be those opposed to boosting funding. In one example, Massachusetts made its first gasoline tax increase — 24 cents — in 20 years, but could see a rollback at the polls come Election Day. Meanwhile, California’s own increase proposal may not even be enacted as the Fed Up at the Pump coalition attempts to mobilize the populace to convince the government not go through with the increase next January, believing the tax will not go into greenhouse-gas reduction programs as well as harm lower-income citizens.

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Analysis: Toyota Could Bring $7.2 Billion To Texas Over Next Decade http://www.thetruthaboutcars.com/2014/05/analysis-toyota-could-bring-7-2-billion-to-texas-over-next-decade/ http://www.thetruthaboutcars.com/2014/05/analysis-toyota-could-bring-7-2-billion-to-texas-over-next-decade/#comments Fri, 16 May 2014 10:00:26 +0000 http://www.thetruthaboutcars.com/?p=821306 Toyota’s big move from California to Texas may also bring a big return for Plano, Texas over the next decade, to the tune of $7.2 billion of economic activity. Bloomberg reports an analysis by Chicago-based Grant Thornton LLP claims the $7.2 billion includes $4.2 billion from payroll taxes, as well as direct and indirect payments, […]

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Toyota Texas

Toyota’s big move from California to Texas may also bring a big return for Plano, Texas over the next decade, to the tune of $7.2 billion of economic activity.

Bloomberg reports an analysis by Chicago-based Grant Thornton LLP claims the $7.2 billion includes $4.2 billion from payroll taxes, as well as direct and indirect payments, and revenues from sales and property taxes. The analysis was issued on the same day Plano approved a large incentive deal for Toyota, including $6.75 billion in grants and property tax discounts. The state government also approved an incentive package, totaling $40 million.

The report also notes the move and consolidation of Toyota’s operations in the United States to Plano from California, Kentucky and New York, announced last month, is expected to bring as many as 3,650 full-time employees with an average salary of $104,000 by 2018.

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Foxx, Obama Administration Urge Congress To Act On Funding Highway Trust http://www.thetruthaboutcars.com/2014/05/foxx-obama-administration-urge-congress-to-act-on-funding-highway-trust/ http://www.thetruthaboutcars.com/2014/05/foxx-obama-administration-urge-congress-to-act-on-funding-highway-trust/#comments Thu, 15 May 2014 14:00:58 +0000 http://www.thetruthaboutcars.com/?p=820890 With 112,000 infrastructure projects and 700,000 jobs at stake, the Obama administration and Secretary of Transportation Anthony Foxx are both urging Congress find a way to provide funding to the United States Highway Trust Fund before the well goes dry as early as August. Autoblog reports both parties offered Congress a four-year funding bill that […]

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With 112,000 infrastructure projects and 700,000 jobs at stake, the Obama administration and Secretary of Transportation Anthony Foxx are both urging Congress find a way to provide funding to the United States Highway Trust Fund before the well goes dry as early as August.

Autoblog reports both parties offered Congress a four-year funding bill that would help raise the needed funds through tolling by individual states, and through closing a loophole on deferred corporate taxes on overseas earnings, which alone would bring $150 billion to the table.

In the Senate, an alternative bill is in the works that would retain funding levels at $105 billion annually with interest for six years, though sourcing the funds would come at a later date. Meanwhile, Republican legislators aren’t keen on raising taxes to fund the trust, especially during the 2014 election season.

As for why the fund is running dry, an 18.4-cent-per-gallon fuel tax issued in the 1990s hasn’t been raised in over 20 years to keep up with increased fuel efficiency among new vehicles, with more increases coming down the CAFE pipeline.

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CA, MD Extend EV/PHEV Credit Programs, Federal Credit Increase May Follow http://www.thetruthaboutcars.com/2014/05/ca-md-extend-evphev-credit-programs-federal-credit-increase-may-follow/ http://www.thetruthaboutcars.com/2014/05/ca-md-extend-evphev-credit-programs-federal-credit-increase-may-follow/#comments Mon, 05 May 2014 13:00:48 +0000 http://www.thetruthaboutcars.com/?p=815506 EV and PHEV owners in California and Maryland will be able to enjoy credits for the foreseeable future for going green, while one representative in Congress wants to up federal tax credits to $10,000. Autoblog Green reports the success of the California Air Resources Board’s credit program has resulted in a funding expansion of $25 […]

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2014 Honda Fit EV

EV and PHEV owners in California and Maryland will be able to enjoy credits for the foreseeable future for going green, while one representative in Congress wants to up federal tax credits to $10,000.

Autoblog Green reports the success of the California Air Resources Board’s credit program has resulted in a funding expansion of $25 million through the end of the state’s fiscal year in late June. Those seeking rebates on their EV or plug-in purchases will be put on a list, and should receive either their $2,500 EV or $1,500 PHEV credit by the end of September.

Over in Maryland, a provisional bill awaiting Governor Martin O’Malley’s signature will extend the state’s credit program for three years through the end of June 2017. In addition, the maximum credit offered will be increased to $3,000 from $1,000 for PHEV owners.

Finally, U.S. Representative Peter Welch of Vermont is preparing to propose legislation that would boost the federal tax credit from $7,500 to $10,000, which he believes will also make owning an EV more affordable to middle-income consumers. Welch will introduce the legislation upon return to Congress.

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Japanese Auto Market Takes Sales Hit As Consumption Tax Increases http://www.thetruthaboutcars.com/2014/05/japanese-auto-market-takes-sales-hit-as-consumption-tax-increases/ http://www.thetruthaboutcars.com/2014/05/japanese-auto-market-takes-sales-hit-as-consumption-tax-increases/#comments Fri, 02 May 2014 10:00:09 +0000 http://www.thetruthaboutcars.com/?p=813657 The Japanese auto market took a hit in sales last month, falling 5.5 percent to 345,226 units as an increased consumption tax of 8 percent took hold in a sign of a slow year in sales. Bloomberg reports the drop comes at the end of a seven-month-long sales surge of over 783,000 vehicles through March […]

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2014 Honda Freed Spike

The Japanese auto market took a hit in sales last month, falling 5.5 percent to 345,226 units as an increased consumption tax of 8 percent took hold in a sign of a slow year in sales.

Bloomberg reports the drop comes at the end of a seven-month-long sales surge of over 783,000 vehicles through March 2014 ahead of the levy issued by Prime Minister Shinzo Abe to help fight the ongoing financial issues plaguing Japan for two decades. As a result, economists believe Q2 2014 will see the biggest retraction since the 2011 Tōhoku earthquake and tsunami.

As for the outgoing month, Toyota and Mazda both posted their lowest number of deliveries since 2011, while Subaru saw a 41 percent drop to a record low number. Meanwhile, Nissan, Suzuki and Mitsubishi all saw gains in April, with Mitsubishi taking the biggest slice of the market at 27 percent.

The consumption tax will be mitigated somewhat for automotive consumers through a 5 percent vehicle-purchase tax, and will give way in 2015 for a 10 percent national sales tax. In the meantime, the next year could play out like it had in 1997, when the tax jumped from 3 percent to 5 percent and auto sales dropped 15 percent with a 21-month decline in the industry.

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Obama Administration Delivers $302 Billion Transportation Funding Proposal Before Congress http://www.thetruthaboutcars.com/2014/04/obama-administration-delivers-302-billion-transportation-funding-proposal-before-congress/ http://www.thetruthaboutcars.com/2014/04/obama-administration-delivers-302-billion-transportation-funding-proposal-before-congress/#comments Wed, 30 Apr 2014 11:00:52 +0000 http://www.thetruthaboutcars.com/?p=812826 A $302 billion, four-year plan to fund the U.S. Highway Trust Fund — and, in turn, any road and transit projects on the table during the period — was brought before Congress by the Obama administration through the U.S. Department of Transportation. Bloomberg Businessweek reports the proposal would add $87 billion on top of what […]

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Syracuse Road Construction - Utah DOT

A $302 billion, four-year plan to fund the U.S. Highway Trust Fund — and, in turn, any road and transit projects on the table during the period — was brought before Congress by the Obama administration through the U.S. Department of Transportation.

Bloomberg Businessweek reports the proposal would add $87 billion on top of what is currently in the trust fund in order to bring much-needed dollars to the many bridges and transit systems seeking rehabilitation while creating “millions of jobs” and, thus, boosting the economy, according to Transportation Secretary Anthony Foxx. The fund, currently subsisting on gasoline and diesel taxes, would be funded by a temporary tax increase on overseas earnings by companies, which is the method proposed by President Barack Obama back in February 2014 in his budget request.

Meanwhile, both houses of Congress are seeking six-year funding proposals, though none have any financial resources to draw upon thus far. Further, lawmakers on both sides of the aisle have claimed there currently are not enough votes to raise the 18.4-cent tax levied per gallon of gasoline to boost the trust fund’s coffers. One such proposal, made in 2012, failed due to being unable to decide upon a funding source, resulting in a two-year stop-gap measure funded through general tax revenue to keep construction projects moving forward.

The proposal also requested an increase in the National Highway Traffic Safety Administration’s maximum fine for automakers who fail to issue recall notices on defective vehicles in a timely manner. The current maximum fine of $35 million would rise to $300 million “to ensure when a violation occurs it is more than a rounding error,” Foxx explained.

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Auto Sales In Turkey Fall 8 Percent In January http://www.thetruthaboutcars.com/2014/02/auto-sales-in-turkey-fall-8-percent-in-january/ http://www.thetruthaboutcars.com/2014/02/auto-sales-in-turkey-fall-8-percent-in-january/#comments Thu, 06 Feb 2014 15:39:02 +0000 http://www.thetruthaboutcars.com/?p=734857 Vehicle sales in Turkey fell 8 percent in January to 32,670 vehicles from the previous high of 35,523 units in January 2013 according to national industry group Otomotiv Distribütörleri Derneği and Automotive News. Sales for the outgoing year rose 10 percent to 856,378 units from 777,761 in 2012. ODD predicts sales of 800,000 to 860,000 units […]

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2014 Renault Fluence

Vehicle sales in Turkey fell 8 percent in January to 32,670 vehicles from the previous high of 35,523 units in January 2013 according to national industry group Otomotiv Distribütörleri Derneği and Automotive News.

Sales for the outgoing year rose 10 percent to 856,378 units from 777,761 in 2012.

ODD predicts sales of 800,000 to 860,000 units moved from the showroom to the road in 2014, but warns a tax hike on passenger vehicles and banking regulations meant to curb the growth of Turkey’s current account deficit would put a dent on the forecast.

Turkey’s market could be in for more losses as a wave of bearishness on the health of emerging markets has become the predominant model of thinking among financial observers. Turkey in particular was expected to be a bright spot in the automotive world once the BRIC markets had matured.

 

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Foreigners May Pay Toll to Storm the Autobahn http://www.thetruthaboutcars.com/2013/12/foreigners-may-pay-toll-to-storm-the-autobahn/ http://www.thetruthaboutcars.com/2013/12/foreigners-may-pay-toll-to-storm-the-autobahn/#comments Tue, 10 Dec 2013 12:00:10 +0000 http://www.thetruthaboutcars.com/?p=676130 If you happen to live outside of Germany, you may soon find yourself paying a toll to do your best Burt Reynolds and Dom DeLuise impressions on the Autobahn. The reason? While residents living in the nine countries surrounding Germany make extensive use of the Autobahn in their travels, the Germans are left footing the […]

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autobahn

If you happen to live outside of Germany, you may soon find yourself paying a toll to do your best Burt Reynolds and Dom DeLuise impressions on the Autobahn.

The reason? While residents living in the nine countries surrounding Germany make extensive use of the Autobahn in their travels, the Germans are left footing the bill for maintenance on the famous infrastructure. Since foreigners don’t pay taxes to Germany, Chancellor Angela Merkel’s coalition government has opted to enact a toll aimed at non-German citizens in order to share responsibilities.

The plan has detractors, of course, ranging from Austria’s transport minister Dores Bures threatening to take Germany to the European Court of Justice over the toll, to German auto club ADAC stating that even the potential revenue wouldn’t be enough to cover all the Autobahn’s maintenance costs.

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House Democrat Introduces Bill to Raise Federal Gasoline Tax by 15 Cents Per Gallon http://www.thetruthaboutcars.com/2013/12/house-democrat-introduces-bill-to-raise-federal-gasoline-tax-by-15-cents-per-gallon/ http://www.thetruthaboutcars.com/2013/12/house-democrat-introduces-bill-to-raise-federal-gasoline-tax-by-15-cents-per-gallon/#comments Fri, 06 Dec 2013 11:00:48 +0000 http://www.thetruthaboutcars.com/?p=672418 Federal taxes on highway fuels haven’t been raised in 20 years. Because of inflation and better fuel economy, the Highway Trust Fund, into which those taxes flow and out of which transportation funding is dispersed, faces a shortfall. Standing next to labor, construction and business leaders, Rep. Earl Blumenauer (D-Ore.) announced that he has introduced […]

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Federal taxes on highway fuels haven’t been raised in 20 years. Because of inflation and better fuel economy, the Highway Trust Fund, into which those taxes flow and out of which transportation funding is dispersed, faces a shortfall. Standing next to labor, construction and business leaders, Rep. Earl Blumenauer (D-Ore.) announced that he has introduced legislation that would raise the federal tax on gas to 33.4 cents per gallon and on diesel to 42.8 cents.

“Every credible independent report indicates that we are not meeting the demands of our stressed and decaying infrastructure system — roads, bridges and transit,” Blumenauer said. “Congress hasn’t dealt seriously with the funding issue for 20 years,” the congressman continued. “With inflation and increased fuel efficiency, especially for some types of vehicles, there is no longer a good relationship between what road users pay and how much they benefit. The average motorist is paying about half as much per mile as they did in 1993.”

The American Automobile Association supports the proposal. “Though it would be easier to simply kick the can down the road, today’s proposed legislation takes a necessary step forward in fostering debate on an important issue that many policymakers have been reluctant to address,” said Kathleen Bower, vice president of public affairs for AAA. “The country desperately needs additional funding for infrastructure and, for the moment, there is no better means than the fuel tax. The proposed increase is well overdue and in line with what most experts suggest would be appropriate.”

While states levy their own fuel taxes, about half of transportation funding in the U.S. comes from the federal government. The trust fund no longer brings in enough money to cover its obligations so to fund the federal transportation bill currently in effect, which expires in 2014, Congress had to move more than $50 billion in general tax revenue into the fund. Estimates cited by Rep. Blumenauer say that the trust fund will need $15 billion more each year if Congress decides to keep funding at current levels in the next transportation bill. He said that implementing a $0.15/gal tax over three years would raise approximately $170 billion in the next decade.

If the fuel taxes are not increased, Congress will have to choose between cutting transportation funding at the federal level and moving that tax burden to the states, or funding the Highway Trust Fund with general tax revenue.

The American Society of Civil Engineers said last month that the U.S. needs a $2.7 trillion investment in transportation and other infrastructure by 2020 to keep the United States competitive in the global economy. The Federal Highway Administration has estimated that just to keep our current infrastructure safe, highways and bridges will need more than $70.9 billion worth of repairs.

In the Senate, Barbara Boxer (D-Calif.), chairwoman of the Environment and Public Works Committee, has proposed changing the way taxes are levied on fuel, moving the tax to the wholesale level rather than at the pump.

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