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‘Symbolic’ $25 sales fee on bicycles in Washington state is pointless

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What’s this? Tucked into a proposal by Washington state House Democrats to fund expansive highway projects is a provision to tack an extra $25 fee onto the sale of any bicycle costing more than $500.

The arrangement should be known as the Wal-Mart Protection Act, as only  bicycle-shaped objects sold by mass merchandisers would be exempt from the fee as they don’t sell bikes costing more than $500 in the first place.

Local bike stores will be the ones harmed by imposing the fee as it cuts into their sales margins or could convince potential customers to go online to buy their next bike.

Pointless

The total revenue from the bicycle sales fee is infinitesemal when compared to the total amount that House Democrats want to raise to pay for  more and wider expressways, as well as other transportation projects, according to a fact sheet that explains the proposal.

Also on the table is a gasoline sales tax increase (2 cents more a year for 5 years), a motor vehicle excise tax (0.7%), commercial gross weight fee (15% increase) and $3 billion in bonds.

Altogether, these revenue sources would raise nearly $9.8 billion. Of that, the bicycle sales fee of $25 per bicycle would raise an estimated $1 million over 10 years.

That’s not even one-tenth of a percent of the total. It’s $1 compared to $9,800.

It somehow doesn’t even seem worth the effort to figure out how to collect it. The whole exercise seems pointless. The Seattle Times says the provision was added for “largely symbolic reasons.”

Even the bill’s author doesn’t support the bicycle sales fee — “Lawmaker disagrees with her own bicycle tax.”

[I think the House Democrats grossly underestimated this revenue. If you do that math, you'll discover that $1 million over 10 years at $25 a bike means only 4,000 bicycles costing more than $500 are sold every year in the state. But even sales are double or triple that amount, I can't see how it would be cost effective.]

Big projects

The plan was put forward by Rep. Judy Clibborn of Mercer Island. She’s the chairperson of the House Transportation Committee.

According to a fact sheet issued in support of the proposal, the new revenue would pay for the following:

  • New projects (freeways and expressways) — $3,560 million
  • Transportation system investments (ferry and transit agencies and other) — $1,790 million
  • Stormwater cleanup  — $909 million
  • Maintenance and upkeep (bridge repair) — $635 million
  • Complete streets — $60 million
  • Local government assistance — $660 million

Criticism

The Cascade Bicycle Club was quick to criticize the proposal, and not just because of the $25 fee for selling a bicycle. In it’s blog, Evan Manvel wrote:

“Unfortunately, the package almost completely ignores bicycle and pedestrian investments. Given the benefits people on bicycles provide to the rest of the transportation system by taking cars off the road, this is short-sighted.”

Cascade and the Bicycle Alliance of Washington last week sent a letter to Clibborn that contained proposals on addressing the state’s transportation woes. Here’s a copy of that letter.

More details on the plan are explained at the Seattle Times.

Permanent link to this article: http://www.bikingbis.com/2013/02/20/symbolic-25-sales-fee-on-bicycles-in-washington-state-is-pointless/

2 comments

2 pings

  1. Thee Banana

    I suggest that if this does become law, that bike shops start selling Frame and Rims separately, thus avoiding the combined cost of $500, and if the bike is really pricy then they might have to separate the bike a little more….my last bike build was over $1000 total, but not one piece was over $500.

  2. Charlie Greenwood

    Tax bikes inversely to their price. The cheaper the bike, the higher the tax.

    In some ways this does make sense. There’s already an 11% excise tax on firearms and ammunition to support conservation.

  1. Cyclelicious » A symbolic tax on Washington bike purchases?

    [...] Biking Bis: ‘Symbolic’ $25 sales fee on bicycles in Washington state is pointless. [...]

  2. Why a statewide bike tax makes no sense | Seattle Bike Blog

    [...] the state. While Wal-Mart and K-Mart might have no trouble stocking bikes that cost less than $500 (Biking Bis suggested naming the tax the “Wal-Mart Protection Act”), small bike shop margins on bike sales [...]

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