Automotive Stimulus Plan – Tax Break for Consumers Buying a Vehicle

Automotive Stimulus Plan would give a TAX break to consumers buying a passenger vehicle (car, truck, SUV) between November 12th and December 31st of 2009

Senator Barbara Mikulski delivers a press release outlining her Automotive Stimulus Plan to be introduced to legislation when the Senate reconvenes next week. The plan will help save American jobs, help American consumers and support America’s automobile industry. Her announcement comes just days after the Department of Labor reported that the nation’s unemployment rate has hit a 14-year high as the economy continues to worsen.

“If you buy a passenger car, truck, SUV or Mini van between November 12th and December 31st of 2009. you will get a tax deduction on your sales tax and on the interest of your car loan.”

If a consumer were to passenger vehicle priced $23,600 sold in Maryland with a 6% sales tax and financed with a 5 year loan at a 7% interest rate, the total savings would be $1,757. The interest paid on the loan will be deductible annually throughout the loan term, similar to mortgage interest paid, while the full sales tax will be available for deduction in the year of the vehicle’s purchase.

Please take a few moments and read the full press release here or here and watch the video above.

This a trying time in the auto industry. I ask that you take a moment and use your strength as a leader within our industry and leverage that strength for this amendment to pass. In essence, it will create a tax advantage to our customers and give them confidence that now is a great time to buy a car. No matter what side of the fence you are on, this would be a good thing. If you can, pass your encouraging words onto your local lawmakers as well as your employees, blog about it, write about it, etc. It would help all of us!

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Jeff Kershner

I’m the founder of DealerRefresh. I got my start in the dealer business when I was 18. From there I've worked throughout several departments within fixed to variable ops. Whether it’s managing the desk, perfecting sales process or studying online marketing and media trends, I absolutely love this business and the challenges it brings. On top of keeping up with DealerRefresh, I consult with dealerships and key industry businesses. My passion has been and continues to be helping dealers leverage new media to sell and improve customer service.

Please note: I reserve the right to delete comments that are offensive or off-topic.

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23 thoughts on “Automotive Stimulus Plan – Tax Break for Consumers Buying a Vehicle

  1. Oh gee, if they would only hand out vouchers to pay for the gas I might be game!This past year the exorbitant cost of gas has seriously damaged our economy and society.Families struggled just to fill their vehicles up at the pump to tend to the bare necessities of life. Manafacturers passed on higher operating and shipping costs to consumers resulting in higher prices on every product imaginable. Most all electric companies asked for and were granted a record rate increase that further taxed the american family.Grocries went through the roof and many products not only cost more now they come in smaller packages. By the time we got done filling up the car and buying groceries most families had little left over to spend on so called extra’s , save or invest. In fact most had to dip into their savings just to get by as of late.So, we in turn cut back, cut out the extra’s maybe the cable, eating out, movies, going longer between hair cuts, some have even stopped taking necessary medicine because they can no longer afford it. We drive less, OPEC cuts production, we drive even less, they vow to cut more to jack the prices back up.(and they will) Our counrty spent 168 BILLION dollars on a economic stimulus package that did NOTHING for our economy. That would have gone a LONG way towards getting our nation started on the road to energy independence. We have so much available to us in the way of FREE ENERGY such as wind and solar. Electric plug in cars would cost the equivalent of 60 cents a gallon to drive. 168 BILLION would have gone a long way toward making that technology more affordable to the average Joe. Jeff Wilson has the best book ever called The Manhattan Project of 2009 Energy Independence NOW. If you are worried about our economy and want to see our nation become energy independent I highly recommend this book.

  2. Its a awesome idea! I work in the automotive industry and the times are really hard! I wish that we had this in Michigan to get the industry back on its feet. At my current job, layoff’s have become a daily event. Its is really scary for the younger generations in this particular industry.

  3. @Richard – Banks are lending for auto loans. The media has consumers thinking otherwise.

    @Brett – This is not exclusive for Maryland only. This would be a nation wide government supported Stimulus Plan.

  4. This is a nice gesture, but it will be like medicine and only make some people feel better. How about also addressing one of the core dilemmas of the US auto industry along with it – UNIONS.

    Let’s shift jobs to Domestic Energy and re-vitalize our workforce. Put some legs behind the bill.

    Coincidentally, I am in a Jeep lease that expires in March 2009 but plan to begin researching Chrysler dealers in my area about purchasing right away because Chrysler Financial requires I go through a dealer. Seems to make more sense buying it now rather than living out the lease and buying some other vehicle.

  5. Yep Ryan – the big three are more hurt by unions than anything else. They cannot compete efficiently while the unions are pulling strings. If anything, this down-turn could dispense the unions. I fear something more drastic will have to happen first.

    I heard on the news that Japan is now in recession and the news is claiming the American auto industry is the cause – how friggin’ warped is that report!!!!???? It does feel like the media is gunning for the automotive industry. I’m almost getting to a point where we might want to ask our government to forget stimulus packages and just put a muzzle over some of these reporters.

  6. Well yeh stimulus packages are really just that aren’t they – a stimulus. They do not address the core issues. If bills designed to address the core issues are not passed in conjunction with these then the stimulus packages are probably in vein.

    Disturbingly, I saw on the news today that the average union worker pay in the auto industry was a hair under $30k. I was surprised by this and suffice to say it makes the unions that much less beneficial in my eyes. What a shame.

  7. Well Alex you mean to say the US three. The real Big Three no longer includes Chrysler and Ford. It is the US three that are hurt via the unions. Japan like the rest of the world is in a recession. As business goes global one broken cog effects the whole machine. When the Japanise automakers first came to the US market in the 60s, 70s, and early 80s they made ALL there cars in Japan. As the Japanise automakers produce more cars and trucks in america they take jobs away from Japanise workers in Japan.

    Be mad at the unions for forcing the US three to go to Mexico and China for cheap labor but do not blame Japan. The tax payers of this great country begged the Japanise to make cars here and they did at the risk of hurting their own economy.

    I have been in Detoit dealerships my whole life and it is always the same story: blame someone else.

  8. If we the taxpayers don’t bailout the big US 3, start thinking about accelerated unemployment, de-flation, soup lines, and buy some really harsh pepper spray (i’m a pacifist).

    There are way too many jobs tied to the auto industry in the US. Yeah the big 3 has screwed the pooch here, but the UAW has had them by the short and curlys for decades.

    When the foreign auto makers we’re forced too build in the US, from Bush SR import taxes in the 80’s, we expected a level playing field. The UAW didn’t let up tho, and then the pensions kicked in from the past, etc.

    If we do bailout the big 3 the UAW needs to be on a Fed short leash. I’m for labor unions to some extent, but seriously… it needs to be capped.

  9. Relaying bad info is why the american people are just learning about this bad situation now. This downward spiral of poor dicision making as been going on for years. I say give them the money after they put new managment in place.

    Look at Fords ownership of the Lions for 40 plus years and the way the company has been run is the EXACT same!!!

    It is time for the old guard to go away and for new blood to take over. Giving the same failing dirt bags this money will only lead to a later demise of the same ownership.

    If Toyota or Roger Penske or Yoda has to come in and take over let them. These ever “Shrinking Three” need to fail in order to get the restructuring to be done right.

  10. Relaying bad info is why the american people are just learning about this bad situation now. This downward spiral of poor dicision making as been going on for years. I say give them the money after they put new managment in place.

  11. Just about everyone here simply believes what they’ve been told over and over again. The UNIONS are the ones destroying US automakers. Right…the US automakers have done great planning, consistently produced high quality vehicles that are competitive with foreign makes, don’t have bloated management, haven’t focused more on delivering near-term profits to stockholders than developing rational long-term plans, and don’t deliver hundreds of millions in fat salaries to their top execs.

    It’s all the UNIONS’ fault.

    As long as you believe the crap they feed you, for that long they will easily be able to keep taking your money away from you…and keep you blaming other working people.

    Now may be your best chance ever to see through the crap that the large internaional corporations feed you through the TV stations and newspapers that they own (witness your rape by the “internet bust,” oil speculators, banks and mortgage lenders, Wall Street, a super bloated defense industry, and plain old greedy white collar thieves).

  12. Why can’t it start now with the stimulus help. I am looking to buy a car now. They want us to buy cars asap to help the economy, but want us to wait to the end of the year to start buying. By that time it will have gotten worse because everyone will wait to buy. All they have to do is give you your money back at the end of the year on a car you buy this year. Simple.


  14. How about a break for those of us who can’t afford a new car? Used cars should be included in this litte deal as well. Also, on the subject of economical vehicles, how about a break for the guys on motorcycles? Mileage and cost to operate a scooter or motorcycle is far less than a car. We should recieve the same concideration as those who own four wheels. As usual, the lawmakers only see the centerline of the road and not the whole road.

  15. With the birth of a new “Entitlement Nation” being created now, don’t worry folks… it’ll all be free really soon. Just check your freedom, soul and independence at the door.

  16. The Revelation
    of St. John the Divine
    Chapter 18

    22 And the voice of harpers, and musicians, and of pipers, and trumpeters, shall be heard no more at all in thee; and no craftsman, of whatsoever craft he be, shall be found any more in thee; and the sound of a millstone shall be heard no more at all in thee;

    23 and the light of a candle shall shine no more at all in thee; and the voice of the bridegroom and of the bride shall be heard no more at all in thee: for thy merchants were the great men of the earth; for by thy sorceries were all nations deceived.

    24 And in her was found the blood of prophets, and of saints, and of all that were slain upon the earth.