Kevin Neels, a principal in Brattle’s Washington, DC office, recently authored a report on behalf of Enterprise Holdings that evaluates the effects of discriminatory car rental excise taxes on specific groups of customers and on certain forms of economic activity related to the car rental industry. Excise taxes on car rentals have increased significantly since 1990, and many additional excise tax proposals are currently pending across the country. These taxes have proliferated because of the perception that (1) car renters are from out-of-town, (2) car renters can afford the extra tax, and (3) car rental excise taxes will only be paid by employers. Dr. Neels was asked by Enterprise Rent-A-Car to test the validity of these perceptions, and found that each assertion is false, undercutting the primary rationale for imposing such taxes. In addition, his research indicates that car rental excise taxes have many unintended consequences, including a significant impact on low income populations, a disproportionate impact on minority households, a measurable reduction in the number of vehicles purchased by rental car companies. The report, “Effects of Discriminatory Excise Taxes on Car Rentals: Unintentional Impacts on Minorities, Low Income Households, and Auto Purchases,” is available for download below.