The Automotive Service Association (ASA) testified before the Ways and Means Commission in Austin, Texas, June 5, regarding what it feels is an inequity in the current Texas Franchise Tax code.
Denise Caspersen, ASA’s Collision Division manager; Charles Parker, executive director of ASA-Texas; John Firm, AAM, president of ASA-Texas and owner of Firm Automotive in Fort Worth; and John Miller, owner of Freedom Automotive in Stafford, were all present at the hearing. ASA members from Texas who testified included Vince Oliva, owner of Vin’s Paint and Body Mid Co. Inc. in Nederland, and Vin’s Paint and Body Inc. in Beaumont; Johnny Bang, owner of Johnny Bangs and Bumps Shop Inc. in Tomball; and Danny Sullivan, owner of Sullivan Advanced Auto Care in Kingwood.
If passed, House Bill 429 and its companion, Senate Bill 476, would allow automotive repair shops to be taxed the same amount that dealers, parts stores and tire stores are now taxed.
“The independently owned automotive repair and collision businesses in Texas are being denied equal treatment under the law,” said Parker. “Automotive repair and collision shops owned and operated by new or used car dealerships are taxed at half the rate used to tax the independently owned businesses doing identical work. This is justified in the tax code by classifying dealership sales as ‘retail’ and allowing their service and repair business to be included under that banner.
“Furthermore, repair shops operated by tire companies (NTW, Firestone, Goodyear), parts stores (Pep Boys) and mass-merchandisers (Sears, Wal-Mart, Target) are also charged at half the rate paid by independent repair shops. We should not be taxed at a rate different than a business performing an identical service. We should not be denied the true cost of our product by disallowing our skilled labor.”
Added Caspersen, “We were very pleased with the number of ASA members who took time away from their businesses to attend the hearing and demonstrate how important it is to change the current franchise tax law in Texas. We ask other shop owners in Texas to take the time to contact their legislators asking them to support ASA’s efforts.”