Substitute Senate Bill No. 1447 introduces a new sales and use tax framework for peer-to-peer car sharing services, imposing a tax rate of 9.35% for rentals lasting 30 consecutive days or less. This provision is added to subdivision (G) of section 12-408 of the tax code, which outlines various tax rates. The bill also repeals the requirement for legislative approval to study mileage-based user fees on state highways, thereby facilitating future studies on this topic. Additionally, the bill includes technical amendments to ensure consistency in legal language and outlines a phased increase in tax revenue allocation to the Special Transportation Fund, with specific percentages designated for the General Fund and Municipal Revenue Sharing Fund starting September 30, 2025.

Moreover, the bill establishes that peer-to-peer car sharing facilitators will be classified as retailers responsible for collecting and remitting the sales tax on transactions facilitated through their platforms. It mandates that these facilitators obtain a sales tax permit and maintain records as required by the Department of Revenue Services. The bill also clarifies that shared vehicle owners will not be liable for tax collection if the facilitator has already collected the tax. By aligning the treatment of peer-to-peer car sharing with existing laws for marketplace facilitators, the bill aims to modernize the tax structure and enhance revenue collection from these emerging transportation models.

Statutes affected:
Raised Bill:
TRA Joint Favorable Substitute:
File No. 543: