U.S. Rep. Bill Pascrell, Jr. (D-NJ-08) a member of the House Committee on Ways and Means today introduced an emergency tax proposal designed to relieve consumers, stimulate auto sales and boost the economy. The Auto Ownership Tax Assistance Act would makes sales tax and interest payments on car loans tax deductible from November 12, 2007 through December 31, 2009.
"As Congress considers ways to help the big three auto companies, we must not forget that Main Street auto dealers account for 20 percent of America's retail economy. And they are not limited to three manufacturers," stated Pascrell. "By extending temporary, targeted tax deductions for moderately priced cars and trucks, Congress can relieve working class American families, stimulate auto sales, inspire consumer confidence and put retail workers and mechanics back to work."
The tax deductions would be limited to cars financed at or below $49,500 and would only be available to individuals with an income less than $125,000 and families with a combined income of less than $250,000. The deductions are estimated to save a family about $1,320 on a $25,000 car.
Pascrell recently hosted a roundtable discussion with local car dealership owners and managers to discuss the struggling auto industry and field recommendations to assist the auto industry from the bottom-up. Following the meeting, Pascrell wrote a letter to House Speaker Nancy Pelosi requesting that assistance for local dealers be included in any package designed to boost the auto industry.
Car dealerships currently employ 1.1 million people nationwide. This year 700 dealerships have closed or are on the brink of shutting down leading to the immediate potential loss of 37,000 jobs.
"Millions of Americans rely on the retail auto industry for their livelihood and financial security," stated Pascrell. "I will urge my colleagues in the Congress to take a bottom-up, Main Street approach to relieving the ailing auto industry by supporting these common sense emergency tax deductions."
The Auto Ownership Tax Assistance Act has bicameral, bipartisan support. It has been introduced in the U.S. Senate by Senators Barbara Mikulksi (D-MD) and Kit Bond (R-MO).