Professional Carwashing & Detailing

Groups lobby for carwash tax exemption in Iowa

September 28, 2012

DES MOINES, IA —The Quad City Times reported that the Heartland Carwash Association and the Petroleum Marketers and Convenience Stores of Iowa have lobbied the Iowa House and Senate for a carwash sales tax exemption this year.

The Sept. 23 story stated that carwash owners have tried to persuade the Iowa state government to remove sales tax on the products they need on a day-to-day basis; namely water, soap and electricity.

The groups argued that because many carwashes operate on a coin-op system which does not accept pennies and nickels, it is difficult to charge the customer sales tax.

As a result, the business has to make up for the lost state revenue by providing Iowa’s 6 percent sales tax rate for each wash. According to wash owners, this hurts them greatly.

In effect, carwash owners who do not charge their customers sales tax are paying a 12 percent combined rate. An exemption on sales tax for water, soap and electricity would bring the number down to 6 percent.

The carwash exemption was ultimately merged with other state bills for tax exemption which included the solar and geothermic energy industries.

Read the entire article here.