House approves fee boost, delays action on rental car tax

Posted: Sunday, May 18, 2003

JUNEAU (AP) The state House approved a boost in business license fees Friday that could raise $4.2 million, but delayed action on a car rental tax.

House Bill 162 raises the fee for getting a business license from $25 a year to $100 a year. Sole proprietors age 65 or older would pay just $50 a year.

The increase is less than what Gov. Frank Murkowski had sought when he introduced the bill. He wanted to raise the fee to $200 a year for all businesses. That would have raised about $7.1 million more a year.

House Speaker Pete Kott delayed action Friday on his own bill to tax rental cars. During a late floor session, he abruptly sent the bill back to the House Rules Committee for further consideration.

House Bill 271 would put a 10 percent tax on car rentals and a 3 percent tax on recreational vehicles.

It wouldn't take effect until Jan. 1, 2004, so it would likely raise only $1.5 million at the most next year and cost about $96,500 to administer, according to the state Department of Revenue.

The following year the tax could bring in about $6 million and cost about $70,000 to administer.

The vote on the business license fee increase was 26-11. Opposing the bill were Reps. Tom Anderson, Ethan Berkowitz, Sharon Cissna, Harry Crawford, Les Gara, Max Gruenberg, David Guttenberg, Mary Kapsner, Beth Kerttula, Vic Kohring and Peggy Wilson.

Under a procedural move, it could come up in the House again. The measure must also pass the Senate before it can be considered by the governor.

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