Category Archives: Rental Motor Vehicle and Tour Vehicle Surcharge (HRS 251)

HB 2601, HD-1, SD-1

SUBJECT:  RENTAL MOTOR VEHICLE AND TOUR VEHICLE SURCHARGE, New Surcharge for County Road Improvements

BILL NUMBER:  HB 2601, HD-1, SD-1

INTRODUCED BY:  Senate Committees on Transportation and Energy and Commerce, Consumer Protection, and Health

EXECUTIVE SUMMARY:  Establishes an additional rental motor vehicle surcharge of $2 per day for those who rent motor vehicles without a valid Hawaii driver’s license.  The increment is to be deposited into the state highway fund but is to be used in the county in which the moneys are generated.

Continue reading HB 2601, HD-1, SD-1

SB 2301

SUBJECT: RENTAL MOTOR VEHICLE AND TOUR VEHICLE SURCHARGE, New Surcharge for Road Improvements

BILL NUMBER:  SB 2301

INTRODUCED BY: BAKER, S. CHANG, ENGLISH, KIETH-AGARAN, NISHIHARA, Gabbard, Galuteria, Ihara, Kim, Shimabukuro

EXECUTIVE SUMMARY:  Establishes a new rental motor vehicle surcharge of $4.50 per day, to be deposited into the state highway fund but which are to be used in the county in which the moneys are generated.

Continue reading SB 2301

SB 2731, HD-1

SUBJECT: RENTAL MOTOR VEHICLE AND TOUR VEHICLE SURCHARGE, Car-sharing organizations

INTRODUCED BY: House Committee on Transportation

EXECUTIVE SUMMARY: Establishes a car-sharing surcharge tax of 25 cents per half hour; provided that for each rental of six hours or more, the rental shall be subject to the rental motor vehicle and tour and tour vehicle surcharge of $3 per day. Since a car-sharing arrangement basically seems to be a rent-a-car company that allows renters to rent a car hourly, such car-sharing companies are in direct competition with rent-a-car companies that provide vehicles for rent and should be assessed a similar surcharge amount. In addition, we recommend that current exemptions from the rental motor vehicle surcharge tax, such as the exemption for loaners for individuals with a vehicle in the repair shop, be respected. Continue reading SB 2731, HD-1

SB 2731, SD-2

SUBJECT: RENTAL MOTOR VEHICLE AND TOUR VEHICLE SURCHARGE, Car-sharing organizations

EXECUTIVE SUMMARY: Establishes a car-sharing surcharge tax of 50 cents per hour; provided that for each rental of six hours or more, the tax shall not be more than $3 per day. Since a car-sharing arrangement basically seems to be a rent-a-car company that allows renters to rent a car hourly, such car-sharing companies are in direct competition with rent-a-car companies that provide vehicles for rent and should be assessed a similar surcharge amount. In addition, we recommend that current exemptions from the rental motor vehicle surcharge tax, such as the exemption for loaners for individuals with a vehicle in the repair shop, be respected. Continue reading SB 2731, SD-2

SB 2731, SD-1

SUBJECT: RENTAL MOTOR VEHICLE AND TOUR VEHICLE SURCHARGE, Car-sharing organizations

INTRODUCED BY: Senate Committee on Transportation and International Affairs

BRIEF SUMMARY: Adds a new section to HRS chapter 251 to impose a car-sharing surcharge tax of $ ____ per day, prorated on an hourly basis and rounded upward to the next hour on each vehicle used each month by members of a car-sharing organization. Vehicles subject to the car-sharing vehicle surcharge tax shall not be subject to the rental motor vehicle and tour vehicle surcharge tax.

Amends HRS section 251-1 to define “car-sharing organization” that operates a membership program in which: (1) self-service access to a fleet of vehicles is provided exclusively to members of the organization who have paid a membership fee; (2) members are charged a usage rate, either hourly or by the minute, for each use of a vehicle; (3) members are not required to enter into a separate written agreement with the organization each time the member reserves and uses a vehicle; (4) the average paid use period for all vehicles provided by the organization during any calendar year is four hours or less; and (5) at least 60% of all vehicle rentals made by the organization during the prior calendar year were made to residents of Hawaii. Continue reading SB 2731, SD-1

HB 1894, HD-1

SUBJECT: RENTAL MOTOR VEHICLE AND TOUR VEHICLE SURCHARGE, Car-sharing organizations

INTRODUCED BY: House Committee on Transportation

BRIEF SUMMARY: Adds a news section to HRS chapter 251 to provide the imposition of a car-sharing surcharge tax of $ ____ per day for each vehicle used each month by members of a car-sharing organization. The surcharge tax shall be levied on the car-sharing organization.

Amends HRS section 251-1 to define “car-sharing organization” that operates a membership program in which: (1) self-service access to a fleet of vehicles is provided exclusively to members of the organization who have paid a membership fee; (2) members are charged a usage rate, either hourly or by the minute, for each use of a vehicle; (3) members are not required to enter into a separate written agreement with the organization each time the member reserves and uses a vehicle; and (4) the average paid use period for all vehicles provided by the organization during any calendar year is four hours or less.

EFFECTIVE DATE: July 1, 2014

STAFF COMMENTS: Under a car-sharing arrangement, vehicles may be rented hourly and since a renter does not have to pay for a full day of rental, the rates for the use of the vehicle could be significantly less than if a vehicle was rented from a typical rent-a-car company.

It seems that a car-sharing arrangement is basically a rent-a-car company that allows renters to rent a car hourly. Such car-sharing companies seem to be in direct competition with rent-a-car companies that provide vehicles for rent and should be assessed a similar surcharge amount. If they are not, then issues arise as to how car-sharings and car rentals are to be distinguished.

SB 2731; HB 1894 (Identical)

SUBJECT: RENTAL MOTOR VEHICLE AND TOUR VEHICLE SURCHARGE, Car-sharing organizations

INTRODUCED BY: SB by English, Baker, Chun Oakland, Gabbard, Galuteria, Keith-Agaran, Kidani and 4 Democrats; HB by Yamane, Aquino, Nakashima, Takayama, Yamashita

BRIEF SUMMARY: Adds a news section to HRS chapter 251 to provide the imposition of a car-sharing surcharge tax of $ ____ for each vehicle used each month by members of a car-sharing organization.

Amends HRS section 251-1 to define “car-sharing organization” that operates a membership program in which: (1) self-service access to a fleet of vehicles is provided exclusively to members of the organization who have paid a membership fee; (2) members are charged a usage rate, either hourly or by the minute, for each use of a vehicle; (3) members are not required to enter into a separate written agreement with the organization each time the member reserves and uses a vehicle; (4) the average paid use period for all vehicles provided by the organization during any calendar year is four hours or less; and (5) at least 60% of all vehicle rentals made by the organization during the prior calendar year were made to residents of Hawaii.

EFFECTIVE DATE: July 1, 2014

STAFF COMMENTS: Under a car-sharing arrangement, vehicles may be rented hourly and since a renter does not have to pay for a full day of rental, the rates for the use of the vehicle could be significantly less than if a vehicle was rented from a typical rent-a-car company.

It should be noted that since a car-sharing arrangement is basically a rent-a-car company that allows renters to rent a car hourly, such car-sharing companies are in direct competition with rent-a -car companies that provide vehicles for rent and should be assessed a similar surcharge amount.

However, it is curious why the proposed surcharge will only be imposed if at least 60% of the vehicle rentals were made to Hawaii residents during the prior calendar year. While the rental motor vehicle surcharge is primarily aimed at the visitor market, the surcharge on car-sharing vehicles will not be imposed if they do not meet this requirement.