Close this menu

NetChoice Releases Research on Tax Subsidies to Big Car Rental Industry

Study Exposes Unfair Tax Benefits for Car Rental Industry that are not available to  Peer-to-Peer Car Sharing

Link to Report

WASHINGTON – NetChoice, a trade association fighting for free enterprise and free expression online, today released a report on the unfair benefits the Big Car Rental industry receives at the expense of taxpayers and consumers.

Despite consistent revenue growth and profitability, the rental-car industry, including big companies like Enterprise and Hertz, receives tax benefits costing over $4 billion to U.S. taxpayers and consumers annually, the report shows.

“Our study highlights the extraordinary government favors granted to the car rental industry,” said Steve DelBianco, President of NetChoice.

“The tax breaks, loopholes, and subsidies analyzed in our report are a boon for big car rental companies, who receive over $4 billion in state-sanctioned benefits annually.  State governments hand out billions to companies like Enterprise and Hertz, providing them an unfair advantage over competitors, like peer-to-peer car sharing services.”

According to the NetChoice study, the car rental industry receives:

  • A sales tax loophole costing taxpayers $3.6 billion every year
  • A vehicle registration fee subsidy costing customers $650 million each year

Key analysis in the report shows:

Passing-on Vehicle License Fees is intentionally misleading to consumers

  • The fee, placed next to sales tax on a car rental bill, leads consumers to think that money is being given directly to the state, when it goes directly to the car rental company’s bottom line
  • The only example of somewhat similar fees is in highly regulated public-utility companies — very different than the car rental industry

Big Rental is asking government to help eliminate competition from peer-to-peer car sharing service

  • A recent survey of rental-car operators revealed that “competition from peer-to-peer networks” ranked as one of the top self-reported threats in 2020
  • These peer-to-peer car sharing services don’t receive the same state-granted benefits as the car rental industry
  • The car rental industry is lobbying the government to regulate peer-to-peer car sharing like traditional car rental companies, even though they would not receive the same state-granted benefits

The full report can be found here.

About NetChoice

NetChoice is a trade association fighting to protect free expression and free enterprise online. Described by Politico as “Silicon Valley’s most aggressive lobbying presence in Washington,” we advocate at the local, state, national, and international levels, working with the tech industry, lawmakers, and academia.