Legislative Bulletin - February 16, 2010

TRALA Opposing Increase in New Mexico Vehicle Excise Tax

TRALA is opposing legislation in New Mexico that would result in a 33% increase in the State’s vehicle excise tax. Currently, the vehicle excise tax is three percent of the price paid for a vehicle. Two separate but identical bills under consideration in the New Mexico legislature, House Bill 271 and Senate Bill 240, would increase the vehicle excise tax to four percent.

TRALA has contacted the sponsor of the House version, Assemblyman Roberto Gonzales, and the sponsor of the Senate version, Senator George Munoz to discuss the negative impacts this tax increase would have on the truck renting and leasing industry and its customers in New Mexico. TRALA explained that in addition to the overall bad economic climate, model year 2010 trucks cost more than earlier models due to costs associated with clean diesel technologies driven by U.S. Environmental Protection Agency (EPA) mandates. Adding higher taxes on top of more expensive purchase prices could be a disincentive to purchase or lease new vehicles.

TRALA’s letter states that utilization of new clean diesel technologies will result in a 90% reduction in NOx and particulate matter emissions over previous model years. Additionally, ultra-low sulfur diesel being used in 2010 engines uses 96% less sulfur than regular diesel. However, increased taxes on the purchase and lease price of these trucks will slow the introduction of these new clean diesel technologies and their environmental benefits in New Mexico. Furthermore, increased costs of the most environmentally friendly trucks available will endanger jobs in New Mexico dealerships and truck manufacturing facilities across the country.

To see copy of Senate Bill 240, please click here. A copy of the letter sent to Senator Munoz can be seen here. For more information on the proposal to increase the vehicle excise tax in New Mexico, please contact TRALA’s Tom James at tjames@trala.org or Joe Sculley at jsculley@trala.org or by calling (703) 299-9120.