A Colorado Senator want to exempt the state sales tax on used cars to help low-income consumers.
Sen. Larry Crowder represents 16 counties in southern Colorado. Fifteen of those counties are below the federal poverty line.
Crowder sees lowering the cost of used cars as critical for the residents of those counties.
“I’m looking for reliability on transportation,” he said. “The intent is to help the lower and middle class.”
The bill passed out of the Colorado Senate’s Finance Committee.
Crowder is adding an amendment to the original bill to cap the exemption at somewhere between $17,000 and $22,000. He wants to avoid the unintended consequence of proving a tax break for classic car collectors.
While the bill exempts used cars from state sales tax, Crowder said they remain subject to local taxes and fees.
Crowder said the exemption will cost the state in sales tax revenue, but increases in income tax might offset some of that loss.
No group promoted the idea of the exemption, Crowder said, but dealers do support it.