Rental Car Tax Proposed to Fund Sioux Falls Development

SIOUX FALLS, S.D. (AP) — The Sioux Falls Development Foundation wants voters to decide whether to enact a $3-per-day tax on most rental vehicles to help fund economic development.

The idea came after a year of analysis by six former foundation board leaders. Current Chairman Dale Froehlich tells the Argus Leader the group reviewed about a dozen potential new revenue sources before settling on the rental car approach. He says a $3 daily tax would generate about $1 million annually.

A representative for Enterprise Rent-A-Car said car rental excise taxes are "regressive, discriminatory, economically harmful and violate the Constitution."

The City Council will begin considering the proposal Tuesday. If the council ultimately gives its blessing, a public vote would be held April 12. Collection of the tax could start in July if voters approve.

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