Industry fights Ga.'s looming tax burden on leases
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The Georgia Legislature is considering a bill to amend a new state tax law effective March 1 that would disproportionately hurt auto leases.
"They're working on it," said Danielle Fagre Arlowe, senior vice president of state government affairs for the American Financial Services Association.
Unless it's changed, the new Georgia state sales tax would levy a 6.5 percent tax on a leased vehicle at the time of the deal and another 6.5 percent tax on each monthly lease payment. On vehicles purchased with a loan or cash, the 6.5 percent tax would be levied only at the time of the deal, according to AFSA.
Arlowe said the added tax on leases, part of a long and complicated tax law, appears to have been unintended.
AFSA, headquartered in Washington, and the National Vehicle Leasing Association of Hanover, Md., complained about the tax in a letter to state lawmakers in November.
Last week AFSA; the Alliance of Automobile Manufacturers; JM Family Enterprises of Florida, an auto distributor, retailer and F&I provider; and the Georgia chapter of the National Federation of Independent Businessmen all wrote to the Georgia Legislature in support of a new bill to amend the sales tax.
"It appears that everyone involved with leasing is supporting the amendment," said Bill Morie, president of the Georgia Automobile Dealers Association in Atlanta, in an e-mail last week.
You can reach Jim Henry at autonews@crain.com.
