Autoblog

The idea of having Uncle Sam come after you for back taxes is an unpleasant thought for any American. It's another story altogether when the feds are the ones doling out the Benjamins, though, as Ford is learning. The Blue Oval is officially suing the government for $445 million in overpaid taxes between 1983 and 1989 and again from 1992 to 1994. Ford wasn't overly excited about filing a lawsuit against the IRS, but due to the overwhelming amount of money involved and the fact that Ford can use all the cash it can get its hands on, the company felt it had little choice. The government actually claims to have paid the money in full, but Ford contends that the interest was not fully repaid. Considering that the additional interest was nearly half a billion dollars, we're guessing Ford really overpaid back in the day.

[Source: Detroit News]

The Malaysian government has decided to end its protection of Malaysia's Proton Motors. In addition to the import duties and taxes levied against foreign carmakers, Proton was also the recipient of tax breaks and "other government incentives."

The decision could be seen as a blow to Proton, but Malaysian Prime Minister Abdullah Ahmad Badawi is confident that the carmaker can and is turning itself around. Even though it has lost half of its market share while it was being protected by the government, Badawi said recently "No question of a bailing out. Proton is doing well today... they have a good program, they have secured exports to India, China, Indonesia and the Middle East."

For it's part, Proton's efforts to link up with a foreign car company didn't end well last year. For the moment, it has proposed that the government take an official stake in the company.

[Source: InsideLine]

The hallmark of the environmental debate is that there are so many important players on so many different sides. Eminent scientists and intellectuals have taken every side of the debate, challenging their eminent colleagues. When it comes to the two most involved and highly charged players, the automakers and politicians, things get even more curious. On the same day that Bush opposed a gas tax to give states more money to repair bridges, Alan Mulally said he supports the idea of a gas tax to encourage customers to buy more fuel efficient vehicles.

Mulally believes Congress' CAFE standards represent failed policy and has hurt automakers. Regulating fuel efficiency has, in his opinion, only lead to consumers buying more cars and driving more. While making sure to stress that he and Ford are all in favor of fuel efficient vehicles and environmental health, he wants some of the onus put back on consumers. He said, "I just think it's so important that we all join in this debate and we really decide what we want to do about energy security and global warming. A piece of that could be a tax."

[Source: Detroit News]

Congressman Ed Markey (MA) has released a new report entitled Tipping the Scales to coincide with a bill titled H.R. 5579, the No Special Subsidies for Gas Guzzlers Act. The report focuses on the tax loophole that exempts people purchasing an SUV from paying a gas-guzzler tax, which is normally applied to the purchase of any vehicle returning less than 22.5 mpg. The report points out that, for instance, someone buying a 20.5 mpg Audi gets dinged by a $1,300 gas-guzzler tax, while someone purchasing a 15.8 mpg Jeep pays no extra tax. Congressman Markey's bill would also close a "loophole" that allows business owners to write off most of the cost of an SUV, but not other types of vehicles.

Fair enough. Joe Average consumers should not be exempt from a gas-guzzler tax on an SUV that will be used for soccer practice runs and towing the family boat. However, legitimate businesses that require the utility an SUV or large truck provides shouldn't be penalized, either. To close the loophole may mean that the landscaper down the street has to pay a gas-guzzler tax on a vehicle that his business requires, which is a different proposition altogether. That is, of course, unless you want to argue that no business requires a body-on-frame SUV, but we're doubting that's the case.

Markey's report estimates that the loophole will cost taxpayers $2.6 billion next year and $15.7 billion over the next decade. While the current tax law at stake here needs some attention, rather than just closing the loophole, perhaps some intelligent people should sit down and revise the law so that it doesn't encourage consumer purchasing of extra large SUVs but also doesn't penalize those business and industries that require vehicles like this.

Oh, and it would be a lot easier to take Mr. Markey's argument more seriously if someone had the caught the reference in his report to a "GMC Yukon Sierra", which technically doesn't exist. You can get a Yukon SUV or a Sierra truck, but you can't get both in one without a head-on collision.

[Source: Wired]

Since you’re paying a premium for that hybrid in the garage it’s important to get back every penny of that purchase you’re entitled to. If you purchased either a Ford Escape or Mercury Mariner Hybrid this year (or any other automaker’s hybrid), next year you’ll be able to claim some type of tax incentive that ranges anywhere from $1,950 to $5,925 depending on where you live. Ford dealers now have a direct line to a hybrid hotline set up by the company that will aid Blue Oval customers in determining how much in incentives their entitled to from federal, state and local governments. 

Where’s the most lucrative state in which to own a hybrid? West Virginia, which combines the $1,950 - $2,600 federal tax credit with West Virginia’s Alternative Fuel Motor Tax Credit for a grand total of between $5,310 and $5,925 in tax relief.

[Source: Ford]

Looking for an easy tax credit? Look no further than the U.S. tax credits for hybrid vehicles. While the program's days are numbered, our friends over at Treehugger tell us that the program isn't extinct yet.

60,000 vehicles is the magic number of hybrid each manufacturer can sell and still have buyers net a tax credit of up to $3,400. Only Toyota is close to that unit total, with the expectation that they'll hit it later this fall. Honda may not hit it this year after having sold just over 40K, and with only 3,475 Ford Escapes having found their way off the lot, there's no immediate fear that Ford will hit that 60K in the near future.

[Source: Treehugger]