The following is the latest on some of the major issues being addressed by NADA. Please don’t hesitate to contact me at rick.desilva@libertysubaru.com if you have any questions.
NADA Applauds Advancement of Legislation to Stop FTC’s Flawed Vehicle Shopping Rule
The House Financial Services and General Government (FSGG) Appropriations Subcommittee recently passed the Fiscal Year 2025 appropriations bill, which included a NADA-backed provision that would stop the Federal Trade Commission (FTC) from implementing or enforcing the Vehicle Shopping Rule (also known as the “CARS Rule”) until September 30, 2025.
The onerous Vehicle Shopping Rule, finalized at the end of 2023, is simply terrible for consumers. It will add massive amounts of time, complexity, paperwork, and cost to car buying and shopping for tens of millions of Americans every year by requiring dealers to provide an extensive series of unnecessary written and oral disclosures when communicating with consumers related to the vehicle sales price, certain credit terms, and voluntary protection products.
A study by the Center for Automotive Research (CAR) found the Vehicle Shopping Rule would cost more than $24 billion over the next decade and would add 60-80 minutes to the car buying process, which would harm consumers. Click the link to review the full CAR study.
https://www.cargroup.org/publication/assessment-of-cost-associated-with-the-implementation-of-the-federal-trade-commission-notice-of-proposed-rulemaking-addendum/
Commenting on the Vehicle Shopping Rule, NADA President and CEO Mike Stanton said, “This flawed rule would upend the sales process for consumers and small businesses. Either through the courts or Congress, this rule needs to be stopped before it wreaks havoc on consumers and the entire car-buying and car-shopping process.”
NADA Requested Relief for Dealers Encountering Problems with Registration and Submission of Time of Sale Reports in the IRS Energy Credits Online Portal
On May 30, 2024, NADA submitted a letter to the U.S. Department of the Treasury and the Internal Revenue Service (IRS) formally requesting relief for dealers that have not been reimbursed for the advanced payment of Section 25E and Section 30D clean vehicle tax credits applied at the point-of-sale for 2024 clean vehicle sales because of problems with registration for the advance payment program and submission of Time of Sale reports in the Energy Credits Online portal.
NADA submitted the letter following extensive discussions with the Treasury and the IRS over the last two months to define the types of problems encountered by affected dealers and the scope of outstanding reimbursements.
The letter stressed that, because the customers involved in each sale received the benefit of a clean vehicle tax credit transfer, dealers should not be forced to incur losses on these sales based merely on technical non-compliance with certain regulatory requirements of the advance payment program, particularly given the technological and administrative difficulties encountered during the portal’s implementation.
NADA will continue to push for relief for the affected dealers and to stress the importance of this issue in its communications with Treasury and IRS. Dealers should refrain from applying clean vehicle tax credits at the point of sale if they have not completed registration for the advance payment program or experience problems with the portal when submitting a Time of Sale report.
Dealers are also reminded that, for transactions involving a clean vehicle tax credit transfer, they should not deliver a vehicle to a customer until after properly submitting a Time of Sale report. In addition, dealers are cautioned against spot deliveries involving a clean vehicle because a return after delivery could cause the vehicle to lose eligibility for a tax credit on a subsequent sale.
NADA members may obtain additional guidance and information regarding the Clean Vehicle Tax Credits from NADA’s Clean Vehicle and Refueling Incentives webpage by visiting https://tinyurl.com/nadaincentives.
