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Wed Nov 15, 2017, 03:16 PM

Industry groups ask Oregon Supreme Court to kill new sales tax on cars

A used car dealership and two road-user industry groups are asking the Oregon Supreme Court to overturn a new 0.5 percent tax on the sale of new cars.

Oregon AAA, subsidiary AAA AutoSource and the Oregon Trucking Association argued in a Nov. 3 petition that the planned tax violates the Oregon Constitution, which puts strict limits on expenditures of road-related tax revenues.

The state fund that is used to pay for roads is separate from the fund that pays for other state services. Voters approved an amendment to the Oregon Constitution in 1980 that requires proceeds from vehicle-related taxes to go to the road fund and pay only for highway-related expenses.

But the tax set to take effect on car sales on Jan. 1 -- dubbed the "privilege tax" by lawmakers, because they say it's a tax on dealers for the privilege of selling cars -- won't work that way. Privilege tax revenues would go into a new separate spending account to subsidize purchases of electric vehicles. Legislative staffers estimated the tax will raise about $60 million per year.

Read more: http://www.oregonlive.com/politics/index.ssf/2017/11/industry_groups_ask_oregon_sup.html

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