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ACIC: Unfair Crash Tax Continues to Spread in CA

Source: PCI

Posted on 17 May 2010

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The unfair practice by some local governments to impose a tax on auto accident victims is continuing to spread unabated across California at the expense of often unsuspecting motorists, according to the Association of California Insurance Companies (ACIC).

The latest communities to consider crash taxes are in San Diego County -- National City and Chula Vista. Nearly 40 local governments have either enacted or are considering the enactment of crash tax ordinances.

“In some cases, local governments impose a tax on just out-of-town drivers involved in accidents within their jurisdictions. Others levy the fee on all accident victims. Still others target just at-fault drivers or accidents that involve fires or spill cleanups. Sacramento city officials are even considering taxing homeowners for putting out house fires,” said ACIC President Sam Sorich.

“The tax – regardless of what form it takes -- is unwise and unfair. The fees can be $2,000 or more. In some cases the auto accident victim’s insurer will pay the tax. Other insurers will not pay it, which makes the driver who is taxed liable for the fee.”

Sorich pointed out that if the practice continues to spread among local governments, all drivers ultimately could be affected through increased premiums to pay the taxes.

“Californians already pay taxes for police and fire protection. To single out accident victims for another levy is double taxation and for out-of-town drivers it’s taxation without representation. It also victimizes drivers twice – once by being in an unfortunate accident and then again with a tax,” said the ACIC president.