Hertz free days -- what a scam

Discussion in 'Hertz | #1 Awards/#1 Club' started by tommy777, Feb 22, 2011.  |  Print Topic

  1. tommy777
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    tommy777 Co-founder

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    I have about 5K award points with Hertz and I was thinking about redeeming a couple of free days in Phoenix this weekend as it was pretty expensive. I know you have to pay taxes and fees, but boy, I never imagined a company can charge taxes on something that's free. Guess what, they are actually charging taxes and fees on the full cost amount.

    The taxes and fees for a two day "free" rental in Phoenix comes out to over 50 bucks!

    Yes, I know PHX has the highest fees in the country, but it puzzles me that Hertz charges taxes and fees on the full price instead of the real rental price which is 0


    CDP Name : AAA ALLIANCE AUTO CLUB
    CDP Rate : Your Rate has been discounted based on the Hertz CDP provided
    2 weekend days at 65.60 USD
    131.20 USD

    Rate Details
    Airport concession fee recovery
    15.23 USD
    Customer Facility Charge:
    12.00 USD
    RENTAL SURCHARGE PER RENTAL (MINIMUM CHARGE 2.50USD)
    4.26 USD
    HERTZ OPERATIONAL MAINTENANCE RECOVERY AND ENERGY SURCHARGE
    6.02 USD

    Vehicle Subtotal
    168.71 USD

    Taxes
    27.50 USD

    Total Approximate Charge
    196.21 USD
     
  2. sobore
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    sobore Gold Member

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    Wow. Scam seems to be the right word here.
     
  3. Jaimito Cartero
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    Jaimito Cartero Silver Member

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    The PHX airport has one of the worst tax ripoffs around. Not just Hertz, but most airport locations. You can get the HLE locations for much less. I've even rented off airport, and then returned to the airport for no additional fees.
     
  4. misman
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    misman Gold Member

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    I agree. If they want to charge the additional fees, that's one thing. But... is is "legal" to charge taxes on amounts not charged? That's what seems shady to me.
     
  5. UADomer08
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    I'm confused by the line item bill provided above. Based on the charged items, the taxes are being calculated off on the $131 charge and associated fees for the 2 day rental. Was there a line item credit returned at the bottom of the bill that eliminated this charge?
     
  6. tommy777
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    My point exactly. When you redeem a free night at a hotel, you don't get charged taxes on what the hotel would have been if you paid for it. If it's an amount being charged via a percentage, the number for a free day should be 0
     
  7. HaveMilesWillTravel
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    Not sure about other states, but in California you pay full tax on the undiscounted price of a cellphone even if the carrier offers it with a discount for signing up for a contract. I wonder if the same is happening here.

    But then, of course, there are hotel chains like Hyatt that cover the taxes that they are presumably still due to the state/local tax authorities for award nights. That's good business practice, IMO. Free should be free.
     
  8. Jenny & Curt
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    And, not to defend Hertz because I always have the feeling they're just trying to get me to forget to cross a 't' or dot an 'i' so they can charge me some outrageous amount, but they probably still have to pay the airport their blood money for whatever they call the ridiculous airport concession fee.
     
  9. UADomer08
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    Again, we are talking about items on an Approximated Bill based on anticipated charges. Was this the total that was actually paid or just what you believe will be due. The billing system is likely programmed to calculate tax based on the vehicle subtotal and has no way of knowing that the 2 days will be credited. Its simply performing a calculation and reporting. Unless there is a finalized bill that shows where the free-day credit is applied, its hard to say what was charged.

    There is rarely any opportunity to avoid the fees. These are charged by the airport, by Hertz, and by certain cities/states and are almost always passed along to the customer. This is no different than the airline policies where you get charged taxes, fuel surcharge, etc.

    I'm not arguing whether the business practices are tacky or poor and whether future Hertz customers should be given a heads-up (or if this is just Standard Op Procedures for rental companies), but I think it is a bit misleading to call it a Scam.
     
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  10. lili
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    lili Gold Member

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    Well, the carrier charges you full tax on the undiscounted price but you have no way of knowing what they actually turn over to the state.
     
  11. HaveMilesWillTravel
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    I am fairly confident that no carrier's finance department/CFO would be stupid enough to scam the Franchise Tax Board in such a blatant way.

    I am sure they do, but so presumably do the hotels that simply cover the taxes on award stays.
     
  12. JasonH
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    JasonH Silver Member

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    It isn't unusual in the least for a rental company to show you the undiscounted total on a "free" rental. In reality these charges are no different than paying fuel surcharges on reward tickets. Depending on the location, your status, and the state/municipality rules you might end up with a $0 charge at the end of it all. For example, I owed $5 for facility fees on a reward rental out of PDX, but Hertz didn't bill me for that. Now they did bill me the $30 in fees/taxes for my reward rental out of KOA. As in many things YMMV.
     
  13. mht_flyer
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    I have redeemed at lot of points with Hertz. They consider the "free rentals" to be DISCOUNT coupons, not free per-se. That's why it shows up that way on your way out from the Hertz facility. They show the prices and they say something like "Promotional coupon applied at return" -- that's why I don't use the points unless the reservation is a really expensive one (like a weekly rental).

    For a "free" weekly rental in DEN in June, I have to pay (which is taxes and fees):

    TOTAL APPROXIMATE CHARGE
    105.49 USD

    Granted, better than paying 500.00 for a weekly rental of a premium car, but still a lot of out-of-pocket money.
     
  14. UADomer08
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    I have used the "free" rentals in the past to cover one way rentals which can get very costly due to mileage. Drove one way from Pensacola to New Orleans for $40. Great deal!
     
  15. bbbb
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    You should have used the light rail to get the car at their Dobson and Main location. Its about a block walk from the rail stop. There is a good chance that you could have returned the car to the airport without a fee.
     
  16. The Missy
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    The Missy Silver Member

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    whats worse is that they charge you the taxes on the full "rack rate" of the car, and not the going rate at the time of rental. I have on multiple occasions chosen to pay for the rental because the difference was just a few dollars over the "free" rate.

    Yes, its a big scam.
     
  17. mht_flyer
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    Not "completely" true though... I'm not sure how your booking the free rental, but if you book online, it will take into account any CDP you have in your profile.

    I've done 4 free rentals the last year (mainly because Hertz expires certain points and they always take into effect the CDP discount and it shows the CDP discount as a line item.
     
  18. Christian Martinez
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    Christian Martinez Gold Member

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    YMMV, I've gotten charged the $20 in taxes at LAX but JFK didn't charge me at all. I use my points for "emergency rentals" i.e., Friend stranded, brother needs me to rent a SUV to transport furniture...
     
  19. chemist562
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    chemist562 In Memorian

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    I rent from Hertz Local Editions (HLE's) whenever possible. Of course, there is the inconvenience of the HLE being over limited hours & getting there. One could rent from the HLE & drop off at the airport.

    For a cruise 2 years ago, I rented from Seatac HLE (1 mile from SEA) and saved over $100. Didn't use points as the total 2 day rental (dropping off DT by the cruise port) was about $25ai. Used a nice fat coupon that saved some serious $$. :) They even paid for my cab going from the airport to their location. [​IMG]

    What you could do is to check prices & rebook at the lower rate. With points, you could either call the Gold line & have them rebook the lower rate (and lower taxes). I am not sure if they would charge the taxes on the lower amount or ? There have been many times where my return price was lower than the estimated charges/taxes.

    Too bad many locations have to charge so many taxes/fees. :mad:
     
  20. UADomer08
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    So I finally got around to clearning my to-do list and dug up an old receipt for a reward rental in Raleigh. The receipt reads as follows:
    Days 2 @ $ 34.79 / Day $ 69.58​
    Subtotal 1 $ 69.58​
    Discount - R 10% $ 06.96​
    Subtotal 2 $ 62.62​
    Concession Fee $ 06.34​
    Vehicle Registration Fee $ 00.44​
    FF Surcharge $ 02.00​

    Tax 14.500% on 71.40 $ 10.35​
    Voucher - 1 $ 62.62​
    Net Due $ 19.13​
    FF: WN0000########## .50 Flight​
    Credits Rewarded​

    Some interesting things to point out:
    1. Taxes were charged against the discounted rate (I believe I used the Southwest one for this because I needed a credit), the fees, and the FF surcharge
    2. Voucher was applied post tax which is why the taxes included the rental rate
    3. I actually got my .5 SW credit despite it being a reward rental! IIRC SW was running a promotion during this time that was double credit for 2 day rentals, triple for 3 days, etc. So I believe I got a full reward credit.
    Hope this helps and happy renting!
     
  21. Quiet Lion
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    I've never been charged the sales tax on a points rental, but the online estimate always includes the tax.

    QL
     
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  22. This has always been my EXACT experience as well. In fact, until I read the post from 2 posts above by UADomer08, I was gonna post asking if any of the people actually complaining in this thread had actually ever GONE THROUGH with an award rental, or if they got scared off by the taxes on the online estimate and paid for the rental instead of using points.

    However, I have always been charged FEES AND SURCHARGES (not taxes) on awards, which can be pricey for example at PHX/LAX/SFO/etc. IIRC the faciltiies fees $10 per rental at LAX-SFO.

    One thing I'm surprised about is that UADomer08 was able to get FF credit for his rental. I halfway wonder if that's maybe the reason why the taxes weren't deducted from his rental in the end?
     
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  23. Jim
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    I have used several "free days" at Hertz local editions. As I recall, I was still paying about ten bucks a day in taxes and junk fees.
     
  24. Frequent Freak
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    This is the correct answer.

    More specifically, Hertz's website computes percentage taxes on the full rate before applying CDP/PC discounts or free day certs, which are really just a PC. On a paid rental, my actual rental charge is almost always a few bucks lower than the estimate due to the difference in tax base. (Very recent example: Nine days ex-GSO ending this last Saturday, $252.80 charged vs. $257.88 original estimate.) On a rental with one or more free days, the difference can be quite large, on the order of $50-100. I don't know why Hertz does this, considering how it makes the bewildering world of rental car taxes even more confusing, but it does.

    So if you are using free day certs for a rental where ALL the taxes are percentage taxes, your rental charge will probably be zero, even though the online estimate says it isn't. If there are any fixed or per-day taxes, however, you will probably still be liable for those, as well as percentage taxes on top of the fixed taxes. In the case of PHX, you are probably running into all the per-day charges to pay for Bill Bidwell's stadium and the like.

    Example with free-day certs: Three-day SUV rental out of DEN. Free-day certs applied to entire rental period. Stated charge at booking was something like $50, actual charge was $7 and change. Colorado charges a $2/day fee on car rentals, which I still had to pay, and there were taxes on top of that. Cheapest paid rental would have approached $300 for same vehicle.

    I find free day certs to be quite useful actually. I generally value them at $75-100/day, in terms of the all-in difference I can realize compared to using other discount codes.
     
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