Congressman Dreier
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233 Cannon HOB
Washington, DC 20515
Office (202) 225-2305
Fax (202) 225-7018

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510 East Foothill Boulevard
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San Dimas, CA 91773
Office (909) 575-6226
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H.R. 100 - the Commonsense Auto Recovery (CAR) Act

Our ailing auto industry is struggling significantly as consumer demand falls to all-time lows. Uncertainty in the markets has led consumers to wait longer to make important purchases on items such as homes and automobiles. While the current lack of demand is impacting retailers of all sectors, it has been particularly detrimental for the auto industry. As consumers wait to make purchases, new and used cars sit in lots across the country.

Unfortunately, the recent debates in Congress have only focused on the role of a few auto manufacturers. However, the automobile industry is much broader than just these companies, and includes dealerships, auto-parts makers and lenders. The lack of car sales has had a significant impact on all of these types of businesses. Any proposal that seeks to stimulate the auto sector cannot focus solely on the manufacturing side, but must take into account the broad range of suppliers and service providers that are also part of the auto industry.

H.R. 100, the Commonsense Auto Recovery (CAR) Act is based on the idea that consumers as well as auto manufacturers, dealers, parts makers and financiers can all benefit from the implementation of a short-term economic incentive to purchase a car. Specifically, the bill:

  • Provides a new, temporary tax credit for 2009 and 2010 in the amount of state and local sales taxes paid on the purchase of a vehicle.
  • Is available for the purchase of both new and used automobiles.
  • Is available for the purchase of any brand of automobile
  • Is available to individuals, as well as small businesses of 50 employees or less.
  • Stipulates that the credit is applicable only to the sales taxes paid on the first $50,000 of a purchase, to ensure that the credit is not abused. Any sales taxes paid above this threshold cannot be used toward the credit.

Congressman Dreier believes this credit will help boost demand, provide an immediate economic stimulus and help to restore job growth in auto-related industries.