An Act To Remove The Exemption From Sales And Use Tax For Automobiles Purchased For Use As Rentals

This bill removes an existing sales tax exemption for car rental companies purchasing vehicles for short-term rentals (less than one year). Under current law, rental companies pay no sales tax when buying these vehicles, but consumers pay a 10% tax on the lease. The bill requires rental companies to pay a 5.5% sales and use tax on vehicle purchases starting January 1, 2026, while the 10% tax on consumer leases remains unchanged. It directly affects car rental businesses that buy vehicles for their rental fleet.