5-1133. Excise tax on car rentals

(Conditionally Rpld.)

A. The qualified electors, by majority vote at an election held pursuant to section 5-1103, may levy and, if levied, the department of revenue shall collect an excise tax on the gross proceeds of sales or gross income from the business of leasing or renting motor vehicles in the authority by a person engaging or continuing in a business taxed under title 42, chapter 5 and classified under section 42-5071, beginning on the first day of the first month beginning ninety days after the election. The tax shall be in effect for three hundred sixty months except as provided by section 5-1139. The tax imposed pursuant to this section is in addition to any other taxes levied by this state or any other political subdivision of this state.

B. Except as provided by section 5-1139, the rate of the tax is .35 per cent of the tax base prescribed by section 42-5071.

C. The tax applies to the business of leasing or renting in the authority, for less than one year, motor vehicles for hire without a driver that are designed to operate on the streets and highways of this state and that are primarily intended to carry not more than fourteen passengers, regardless of whether the vehicle is registered or licensed in this state.

D. The tax does not apply to the lease or rental of:

1. A motor vehicle as a temporary replacement vehicle that is loaned at no charge by a repair facility or dealer for use while the vehicle that it is replacing is not in service because of breakdown, repair, service, damage or loss.

2. A motor vehicle to an automobile dealership, a repair facility, an insurance company or any other person that provides that vehicle at no charge to a person whose own motor vehicle is being repaired, adjusted or serviced.

E. The tax is not taxable under section 42-5071.