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ASA Testifies In Support Of Change In Texas Franchise Tax Law

ASA members testified before the Ways & Means Commission of the Texas House of Representatives earlier this month in support of legislation designed to address inequity in the state’s franchise tax code. The bills — companion pieces of legislation in the House and Senate — would allow automotive repair shops to be taxed at the same rate as dealers, parts stores and tire stores.

ASA points out that new and used car dealerships in Texas are taxed at half the rate of independently owned automotive repair and collision businesses because the tax code classifies dealership sales as “retail” and allows their service and repair business to be included under that banner. Repair shops operated by tire companies, parts stores and mass-merchandisers are treated like dealerships.

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