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Recyclers News Press
Members present: Tracy Hurst, Sue Schauls, Brent
Nugent, Mike Swift, Tom Quandt, David Hesmer, Tom
Snyder, Mike Davidson, Mike Waterbury, Brad
Osborn, Eric L. Piper, Jodi Kunde, Pat Rooff and Jeff
Smid, and Jim Piazza, Jr.
President Tracy Hurst called the meeting to order at
5:18 p.m.
Sue emphasized the purpose of the call to be:
Discuss merit of supplying information from California
to DOT to add sales tax collection to retails (non-
wholesale) transaction made at salvage pools.
It re-
cently came to the attention of the Iowa Auto Recy-
clers that state of California identified that sales tax
must be collected on sales of salvage title vehicles to
entities that are not tax exempted licensed recyclers.
Discuss appropriate language and location for a bill to
add sales tax collection to sales to general public.
Prepare sample bill language (similar to affidavit proc-
ess).
Legislative Agenda 2014 – Sue reported that the Cali-
fornia association had been notified that their one
year report on the sales tax on salvage vehicles sold
to the general public was expected out any day.
SCADA reported they were informed that the tax
revenue actually received was double the anticipated
amount. The report is eagerly awaited!
Sue asked Mike S. to recap the new California sales
tax on public purchases at salvage pools. Mike said
the purpose of this sales tax is to capture lost revenue
on retail purchases which may deter sales of vehicles
to unregulated buyers because they would be re-
quired to pay the tax if they don’t have a sales tax
permit/exemption certificate like licensed recyclers.
There was discussion on the following points: when
to get the DOT involved if this tax would go toward the
road use fund, if these salvage vehicles could be con-
sidered a commodity or parts thus taxable, and what
kind of language would be needed to get this change
moving through the legislative process. It may be best
codified in by the tax board.
Sue suggested compiling a summary report of the
California law, the revenue generated being double
the original estimate and the lost tax revenue by sales
to the general public of vehicles that will not be regis-
tered but are purchased for parts, scrap or export.
Jeff highlighted the “commodities” status of parts cars
and discussed the lack of tax collection on whole cars
purchased for parts. Jeff clarified that sales tax is col-
lected on all parts sales.
Pat clarified the difference between sales tax and use
tax (at registration) and quoted some likely places to
insert the language in the code as well as some areas
that need to be investigated to see if the language
needs to be clarified or if fits the definition of the gen-
eral public paying sales tax on retail purchases and
whether or not it is a use tax or a sales tax.
The discussion generated many good ideas with all
Board members adding value and analysis of the
complex situation. The consensus was that IAR must
identify the lost revenue, the opportunities for minor
law changes and present the information to the Dept
of Revenue, DOT or both prior to the upcoming ses-
sion.
Jim Piazza, IAR Lobbyist, referred to code Section
423.14 which pertains to sales and use taxes.
Continued on next page...
Iowa Automotive Recyclers
Board of Directors Meeting
November 19, 2013—5:15 pm
Teleconference
