Congressman wants to close SUV tax loophole

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]

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