HOUSE OF REPRESENTATIVES	H.B. NO.	1622
TWENTY-NINTH LEGISLATURE, 2018
STATE OF HAWAII

A BILL FOR AN ACT

 

 

RELATING TO MOTOR VEHICLE RENTAL INDUSTRY.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 

     SECTION 1.  Act 137, Session Laws of Hawaii 2017 (Act 137), allows lessors of rental vehicles to pass on to lessees vehicle license recovery fees.  In effect, Act 137 imposes an additional fee upon lessees by passing on motor vehicle weight taxes; fees connected with the registration of specially constructed, reconstructed, or rebuilt vehicles; special interest vehicles, or imported vehicles, license plate and emblem fees; inspection fees; highway beautification fees; and any use tax.

     The vehicle license recovery fees are in addition to already existing law that allows for visibly passing on to lessees general excise taxes attributable to the transaction:  rental motor vehicle, tour vehicle, and car-sharing vehicle surcharge taxes; county surcharge on state tax; and rents or fees paid to the department of transportation.

     Allowing the passing on of fixed one-time costs of doing business, such as license plate fees and use taxes, is a departure from statutory policy favoring the visible pass on of only recurring government fees and taxes.

     In addition, Act 137 creates a new unfair method for calculating the pass on costs.  Previously, the law authorized the pass on of fees and taxes prorated at 1/365th of the annual fees and taxes actually paid on the particular motor vehicle being rented.  That meant the lessee was charged only the amount of fees and taxes directly attributable to their use of the vehicle.  Act 137 increases the prorated rate to 1/292nd, thus resulting in overpayment by individual lessees.

     The legislature finds that Act 137 is an attempt by rental car companies to advertise low base rates but subtly increase the actual per day rental rate by greatly increasing the applicable taxes and fees passed on to lessees, which may be detrimental to Hawaii's tourism industry.

     The purpose of this Act is to repeal Act 137, Session Laws of Hawaii 2017.

     SECTION 2.  Act 137, Session Laws of Hawaii 2017, is repealed.

     SECTION 3.  This Act shall take effect upon its approval.

 

INTRODUCED BY:	_____________________________

 

 

Report Title:

Motor Vehicle Rental Industry; License Recovery Fees; Repeal

 

Description:

Repeals Act 137, SLH 2017, relating to the pass on of vehicle license recovery fees to lessees of motor vehicle rentals.

 

 

 

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.