By Neil Wechsler, owner of Montlake Bicycle Shop
A part of a 9.8 billion dollar transportation plan put forth by Democratic Washington State legislators is to create a new $25 tax on bicycles priced $500 and over. As the owner of the Montlake Bicycle Shop, I am very concerned.
My main points of objection are:
1. That it is based on the false premise that the roads, highways and bridges are paid for primarily by gas and motor vehicle taxes. My research has found that the majority of the cost is borne by the general fund that all taxpayers contribute to. Bicyclists are already paying for the roads, even the few people that never buy a gallon of gasoline. If we drove cars instead of riding bikes it would cost taxpayers more, not less.
2. This sounds preposterous but I spoke to a legislative aide who confirmed that it is true: If this passes the tax would be due only on sales from local bicycle stores. People buying bicycles from out of state who are already not paying our 9.5% sales tax would not have to pay this tax either. On a $500 bike this would amount to a total of about 14.5% in taxes that we would have to charge.
3. When you raise the price of a product sales are certain to go down. Some people will find an untaxed out of state source, some will buy a lower quality bicycle, and a few may not buy a bike at all. That will end up meaning less employment in bike shops in our state. In the last campaign it seemed like every candidate was running on a pro-jobs platform, yet some of them are now suggesting we create a new burden on local small employers is being proposed for invalid “symbolic reasons.”
4. That the tax, which is projected to bring in only $100,000 in revenue per year may well cost the state more than that amount. Creating, collecting, and enforcing another tax is expensive. If you include that some sales would be driven out of state the lost sales tax revenue would pretty much assure that the fee would end up costing the state money.
- Gas, car-tab taxes drive House Dems’ transportation plan [The Seattle Times]
- Lawmaker Disagrees With Her Own Bicycle Tax [Slog]
- Why a statewide bike tax makes no sense [Seattle Bike Blog]