Earlier this year, we reported on a new bill proposed by Tesla and sponsored by Sen. Bob Wieckowski, whose district is home to Tesla’s Fremont factory, to eliminate the sales tax on new cars manufactured in California for out-of-state buyers. Tesla’s goal was to create a program, which has been referred to as ‘Tesla Tourism’, like several luxury car brands in Europe offer, which is to pick up your new car at their factory and make an event out of it – it can include a factory tour and a road-trip across Europe.
Despite having virtually no cost for the state since it would eliminate sales tax on sales that are currently not happening, the bill faced opposition from legislators suggesting it only aims at offering tax breaks to rich people able to afford luxury vehicles.
Now we learn that the initiative has been dropped from the bill in favor of something completely unrelated.
The Mercury News reports that Sen. Bob Wieckowski amended the proposal in order to replace it with a measure to rescue a new housing development in the city of Santa Clara:
“But in June, Santa Clara officials requested an urgent bill to modify terms of a property sale between the city housing authority and the state, said Jeff Barbosa, spokesman for the state senator. The deadline for introducing new bills had passed, and Wieckowski, D-Fremont, decided to amend the Tesla bill as it moved forward in the Assembly, Barbosa said. The amendment replaced the sales tax waiver with the Santa Clara proposal.”
Again, the ‘Tesla Tourism’ proposal would not have cost the state much of anything since only 2 or 3 people a year are reportedly picking up their car from out-of-state since California’s sales tax is higher than in most states.
Also, those new buyers would still be required to pay the sales tax in their home state, where they will register the vehicle. The bill simply aimed at facilitating the process of picking up your car at the factory for out-of-state buyers, which could have spur tourism in the region considering Tesla’s factory is quite an attraction for electric vehicle enthusiasts.
The reason for amending the proposal from the bill seems to have more to do with the timing of California’s legislative process than anything else. Sen. Wieckowski says that he hopes to bring back the proposal next year. Hopefully in time for the start of Model 3 deliveries.