House votes to axe the birthday tax

The House overwhelmingly backed legislation Thursday to phase out property taxes on cars, known as the Birthday Tax because it’s due on the owner’s birthday.

However, some Democrats argued that the bill, which passed 133-39, would amount to a tax increase on average Georgians who don’t use dealers to buy cars.

Under the legislation that still needs Senate approval, people who buy vehicles starting next year won’t pay property taxes on those cars. They also wouldn’t pay a sales tax they’d normally pay if they bought from a dealer. To replace those taxes, all buyers will have to pay a fee of 7 percent, up to a maximum of $2,000, when they title their vehicles.

Georgians who keep their present cars will still have to pay the annual property taxes until they buy another one.

Currently, there is no sales tax on person-to-person, or “casual” sales of cars, so the title fee will capture money from those buyers.

House Motor Vehicles Chairman Tom Rice (R-Norcross) said there are 900,000 person-to-person or “casual sales” of cars and trucks each year in Georgia.

“This is going to be fair to every one of us who buys a car,” Rice said.

Some Democrats agreed.

“This is more fair to more people,” said Rep. Mary Margaret Oliver (D-Decatur)
 

Rice said the title fee will raise more than the current system, providing extra money for local governments and $100 million to $150 million for a new state trauma care system.

 House Minority Leader DuBose Porter (D-Dublin) said that extra money would come from “average Georgians” who buy cars from individuals, not dealers.

“How much money is this going to generate? A whole lot,” Porter said. “Where is it going to come from? Regular folks. 

“This is a great deal if you’re going to buy a $150,000 Mercedes because all you’re going to do is pay the $2,000 (fee),” he said. “If old granddaddy wants to give his son a pickup truck, he’s going to pay a tax.

“We’re creating a brand-new tax that’s going to generate a heck of a lot of new money off of working folks in this state.”

House Majority Leader Jerry Keen (R-St. Simons Island) responded, “It is a tax increase for people who have been doing their transactions under the table.”

245 comments Add your comment

Taxed to death

March 12th, 2009
1:42 pm

So the only way to avoid the tag tax is to buy a new car. Oh boy what a deal thank legislators. You figured out a new way to keep one tax and add another. This will be just additional taxes which we already have way to many. You Gold dome idiots continue to be out of touch with anyone but the rich!

Melanie

March 12th, 2009
1:43 pm

Since when is selling privately owned property to a willing buyer considered “under the table”? How did dealers become the only “legitimate” way to sell a car?

I wonder how much the car dealerships spent to make this crappy piece of legislation happen? I’m surprised they could afford this, considering how many are going out of business lately. At the rate they are closing, no Georgian will see the tax benefit, as the only people left to purchase from will be the “under the table” individuals.

Darrell

March 12th, 2009
1:52 pm

Take away having to pay every year and no sales tax for a 7% one time fee. Right now your sales tax rate is based on what county you live in. Fulton is at 8% now. No that’s not a tax increase for most people. Even those who are buying from individuals are having to pay a yearly tax when they get the tag so a one time fee will be less for them too.

Yankee

March 12th, 2009
1:52 pm

Because of a job change we had been looking to move to Columbus. Now Alabama’s starting to look good.

Drew Scoggins

March 12th, 2009
1:57 pm

Thank God! About time something was done about this. Thank you Legislature

Rollo Tomasi

March 12th, 2009
1:59 pm

Well, thanks a lot republicans. You have screwed over the common folk again. I need to go buy some more vasaline on the way home.

DUANE

March 12th, 2009
2:02 pm

here come the Great Depression 2. Thank you lawmakers.

Annoyed

March 12th, 2009
2:04 pm

Considering many folks roll the tax of a new car purchase into the financing, I would love to know how this will be addressed at the tag office. Maybe the dealers should have thought about the fact that not having the extra 2 grand sitting around will keep customers off the lot even longer. Maybe we can all get a $2,000 bailout from the Messiah in Washington to use towards a new car.

bull-gator

March 12th, 2009
2:04 pm

jsc3

March 12th, 2009
2:05 pm

The legislators are not out-of-touch, they just don’t care. It is all about money. Since the economy went down the toilet, tax collections are down so they need to find a way to raise money. Without money, how are they supposed to buy votes so they can stay in power? It doesn’t matter federal or state government, the game is all the same – get more money. Of course, all you people who demand that the government pay for this, that, or something else, for your use, you are accomplices in this theft from the people.

kevin

March 12th, 2009
2:07 pm

Great, I had been holding off buying the $150,000 mercedes. Now I don’t have any more excuses.

Rob

March 12th, 2009
2:09 pm

What this does is give the rich people a a tax cut while the poor, low income, and middle class pay the bulk of the taxes. People buy cars from private sellers to save money now the government wants to steal your savings. Someone who buys a $30,000 car shouldn’t have to pay the same tax as someone who buys a $100,000 car. They say it eliminates yearly car “birthday” tax, it doesn’t. instead of paying small amounts yearly you would pay several years worth in one lump some. If you like to replace your car every 3-4 years you keep paying over and over. So my guess would be that people would start to keep cars longer which would add to the decline in auto sales.

Retired Rehired

March 12th, 2009
2:10 pm

Thanks politicians……a tax decrease for people buying expensive new cars and a tax increase for middle and lower income Georgians more likely to buy used cars from individuals.

Jeff

March 12th, 2009
2:10 pm

And don’t forget that the “birthday tax”, aka ad valorem tax, was deductible on your Federal income taxes. This new “fee” won’t be.

The Snark

March 12th, 2009
2:10 pm

So, Jerry Keen, buying a used car without paying a tax is a “transaction under the table,” even though no law currently requires me to pay a tax? You are a real piece of work, Jerry. I look forward to voting against you when you try to put your sorry butt in the Governor’s mansion.

John

March 12th, 2009
2:11 pm

“Georgians who keep their present cars will still have to pay the annual property taxes until they buy another one.”

So the real losers are the ones who are keeping their cars they may have bought from a dealer this year or earlier having paid the original sales tax and now have to continue paying the annual tax. I need a new car so why would I buy one now if I have to pay 7% for my county anyway and then I would have to continue paying the annual tax. I’ve just about had with this government!

steve

March 12th, 2009
2:13 pm

You have to wonder if these elected idiots really think about the big picture before they speak/vote ……

WHAT?

March 12th, 2009
2:13 pm

How is buying a car from an individual a transaction under the table? You still pay the state to transfer the title and to get a tag every year so the state knows you the bought the car! Nothing under the table about it! Jerry Keene is fine man for inferring that anyone who doesn’t buy from a dealer is a crook and trying to cheat the government! You, sir, ARE A CLOWN! And I hope the residents of ST. Simons Island remember this next election.

Jeff

March 12th, 2009
2:14 pm

Nice! This legislation will fly under the radar and pass because most Georgians won’t see it. Obviously, dealerships are giddy over this bill because it will eliminate the only advantage of purchasing a vehicle from an individual. This is just another example of our disconnected politicians looking under every stinking rock to make sure they get a piece of the pie. How irresponsible…shame on those who voted for this bill. Please…please make sure everyone reaches out their Senators to complain. THIS WILL IMPACT EVERYONE EXCEPT DEALERSHIPS…SO WHO IS BEING REPRESENTED HERE?

no surprise

March 12th, 2009
2:15 pm

just another example of people coming up with crap to justify their jobs/salary. creating new drama to give them reason to get paid.
thanks for working for the people who gave you the jobs! bull&$*%

ab

March 12th, 2009
2:15 pm

Well this doesn’t help the people with cars that are paid for and plan to keep them for awhile, this is a terrible idea.

ab

March 12th, 2009
2:15 pm

Enter your comments here

bobo

March 12th, 2009
2:15 pm

Think I’ll just sell my truck to my wife for a dollar and pay the 7% tax, buy my wife’s car from her and pay the 7% on that dollar and be done with taxes on my vehicles. Like the lottery, it’s a tax on the stupid.

James

March 12th, 2009
2:16 pm

This will make it more expensive to buy a new car-by 7% upfront. This will have a negative impact on new car sales, which already suck. And since I am already paying the automakers bailout – I think this is just ridiculous double dipping out of my pocket!!!

Jeff

March 12th, 2009
2:16 pm

“Drew Scoggins comment,” Are you serious? Why not reveal which dealership you work for? Probably a Used Car salesman with that comment!

Native Georgian

March 12th, 2009
2:16 pm

Yet another way to sour the economy. Now car sales will go down as people leverage the extra fee into the costs of buying a vehicle. Less car sales equals less taxes. Then we’ll be right back to another birthday tax to make up for the losses. Why fix it if it’s not broken? IF it is broken, then that means it’s not making enough money so the fix is to find a way to get more money. Let us BREATHE through the recession before loading us up with new stuff!!!

Brad

March 12th, 2009
2:18 pm

You can hear the pride in the statement “We’re creating a brand-new tax that’s going to generate a heck of a lot of new money off of working folks in this state.” can’t you. Another politician happy
he found a way to stick it to us. All people take notice-If we keep allowing this to happen, they will
keep doing it.

James

March 12th, 2009
2:20 pm

no surprise, I agree. I would like to know what the legislative body actually accomplishes – seriously, an annual debate regarding Sunday Sales is a HUGE waste of tax dollars!!! And now this stupid idea – if you want to get around paying a tax – as suggested this happens in private sales – this is not the answer. I could sell my car for a buck and the buyer could pay 7 whole cents. If you want to get around a tax, there is always a way…

the evil rich

March 12th, 2009
2:22 pm

It’s always the evil rich, isn’t it. I bet you WANT to be the evil rich though, don’t YOU?

Jerry D

March 12th, 2009
2:23 pm

What a bunch of morons! Let me get this right??? What if I but a car that costs $28,500… 7% of that is $1,995…

We are not talking luxury cars here! Most people finance the tax, etc in with their car loan… but now I will have to pay the 7% up front… or is the tag office going to work out terms with us???

OK… so now, the avg “Birthday tax” on a vehicle that costs 28,500 is a little over $300 per year. At that rate, you would need to keep that car OVER 6.5 years to save any money! What percentage of people keep cars for more that 6 years??? VERY FEW!!!!

So, if you trade in within that 6 years, you are getting screwed more!

Basically, this is making the average person come out of pocket with a large amount of money that these days I am betting they do not have access to and it is also costing you MUCH more if you don’t keep you vehicle longer that about 6 years!

A-Holes!

Ben Dover

March 12th, 2009
2:23 pm

And we didn’t even get kissed first.

Disgusted with Lawmakers

March 12th, 2009
2:24 pm

This is the most ludacrous thing I have ever heard. Please… give us a break here. I am so sick of paying taxes, My husband & I have paid over $24,000 in taxes last year & we are needing to pay another $8,000.00. Not sure where we are getting the money from but ….??? I know no one cares.

2BFREE

March 12th, 2009
2:24 pm

Bobo, the tax (sorry they like the word “fee”)is based on 7% of the State’s value, not the selling price.

And everyone remember if you buy a vehicle, on average you will pay 7% twice. Once when you buy the vehicle, and when you have paid off your loan another 7% to perfect the title in your name only. Since the ad valorem tax is around 1.5% today (and deductible as someone pointed out)a new vehicle every 6 years of average value would be about breakeven. I figured this garbage would pass the House, but was disappointed it was closer.

Home Again

March 12th, 2009
2:25 pm

Well, just moved back here after being gone “up North” for 15 years. It was a shock to have to get three tags when I got here and pay all the fees. And then two months later they hit me again with all the b-day taxes. I thought “wow, what a racket!” Now that they have passed this law I see what they are really doing. They are trying to make everybody that moves into the state from “up North” feel comfortable and welcomed. Of course we are use to paying out the nose when we buy anything because we are from the great state of Taxaylvania. Obama is just a warm up for the real tax and spend politician, Ed Rendell. Get used to these stealth tax increases, more are on the way. This one they just decided to do in the public.

Brightest Bulb

March 12th, 2009
2:27 pm

The vote should go to the people and let us decide since we can’t all be politicians.

Jeff

March 12th, 2009
2:30 pm

as a dealer thanks for all of you who think we invent this crap, I would be totally against this bill because then we will have titling problems because who has that kind of money to come out of pocket when they go to the tag office, where as now we can collect those taxes and put add them into the financing.

RG

March 12th, 2009
2:30 pm

So sell your car to your spouse for a buck and pay the 7% on that and at the same time eliminate the yearly fee. Works for me.

Flyin' Dawg

March 12th, 2009
2:30 pm

Do any of you people understand what is happening here? The 7% fee will replace sales tax when you buy a car and it will still be able to be financed with all of the other dealer fees. For some of you, it will save money- Fulton for instance. If you are concerned about the income tax savings for paying a $200-$300 per year in ad valorem tax, then may I suggest you find a better accountant. Some of you don’t even think before you type. Now as far as the guy who is going to sell his car to his wife, that is a great idea. Let me know if it works.

JM

March 12th, 2009
2:31 pm

So what happens if I sell the car to my wife for $1. Does the state get 7 cents in taxes?

hillarie

March 12th, 2009
2:31 pm

I am not clear here. It sounds at first like all currently owned vehicles are exempt from the new law. “Georgians who keep their present cars will still have to pay the annual property taxes until they buy another one.” Then it says it the fee will apply when buying a used car (aka a car exempted). Does that mean, after I purchase a used vehicle in which the previous owner was paying ad valorem taxes, now I pay the “7% fee” (7% of what, I wonder) and no longer pay the ad valorem taxes?

JM

March 12th, 2009
2:32 pm

RG we had the same idea, just 1 minute apart

Ima Nidiot

March 12th, 2009
2:32 pm

Bobo is a genius: I am going to sell my car to my wife for a dollar, and buy her car for a dollar, pay the 14 cents tax, and be done with ad-valorem tax. Seriously, is this legal to do?? Any tax attorneys lurking on here??

Deep

March 12th, 2009
2:33 pm

I agree with “ab” this is the worst idea ever! What are they thinking about in Washington?
Really?
Please tell me we’re getting “Punked”, Right?

They’re joking….Right?

Annoyed

March 12th, 2009
2:33 pm

Really?
Double taxation. How about that. Pulling us out of the recession. Thanks.

Ekim Eroom

March 12th, 2009
2:33 pm

When you purchase a car from a private seller you get to enter the sales price on the title. Do the math and reduce the purchase price of the car! Not so difficult.

Don

March 12th, 2009
2:34 pm

WOOOO BOYYY…what can we find to tax next…I bet the next thing you will want to tax is the boiled peanuts that you get from from folks selling them along side the road as you ride through the north Ga mountains….OOOPS….I’ve given them another idea…

Greg

March 12th, 2009
2:34 pm

Message to Politicians…

You are worthless pieces of dungheap. The whole idea of doing away with the annual fee was to help Georgians. All you have done is give Rich folks a tax cut (something that has not worked over the past 8 years) and piled it all on the Middle Class and Poor. But of course you do not care. YOU PEOPLE ARE RICH!!
So lets clarify: I keep my car and continue to pay or buy a new one and drop hundreds all at once. Do you think we are stupid. How about forgetting this sham and just keep things as they are!!

-Greg

PS. HOW ABOUT PAYING YOUR TAXES BEFORE YOU STICK IT TO US!!

Bunnie

March 12th, 2009
2:34 pm

Great! Thanks so much for making the tax burden fall even harder on the lower and middle class while letting drug dealers and other show offs cap their taxes on their Mercedes and BMWs! What a wonderful deal for Georgians who are already struggling with unemployment and the loss of home values! Aren’t we lucky to have legislators who have no qualms about taxing retirees and kids getting their first cars, but won’t for the life of them pass public safety laws banning the use of cell phones in cars like every other state in the union?

Ury

March 12th, 2009
2:35 pm

Well I guess this settles it.

No new car for me anytime soon and I guess I don’t have to worry about selling my old one now because the additional title fee will keep most people from wanting to buy it.

Why are our politicans all money hungry idoits?

Sense Common

March 12th, 2009
2:37 pm

Read the Bill folks. The 7% is based on the State’s value, not the selling price. Most Georgians will pay more under this Bill than they do now. The Representatives supporting this Bill has admitted as much. However what they don’t say (because they don’t know), is will the local schools and governments get enough of this to equal out what they get now. I don’t see how they can. In certain years there will be a surplus, but others a shortfall. Most years will come up short, so the county will need to raise other revenue sources, like your property tax.

Doug K

March 12th, 2009
2:39 pm

Man you’ve really got to hand it to the Republicans. This is just another tax dodge for the rich packaged in such a way as to get Joe Six-pack to support it. At a maximum of $2,000 this would essencially wipe out any taxes for an amount paid over $28,572. This means that when the rich buddys of these Republicans buy their $75,000 luxury cars, they will pay no more tax than I would for my little Toyota. Unless you’re rich, your a fool if you’re voting for these Republicans (and the idiot Democrats, like Ms. Decatur, who go along with this robbing the poor to give to the rich). I think it’s time to grap the pitchforks, and the tar and feathers.

RG

March 12th, 2009
2:39 pm

IMA…..I know this much…if you buy a boat even today, you have to get a tag for the trailer but you can get a seperate bill of sale for the trailer which does not include the value of the boat. An lets say you get a bill of sale for $50 for the trailer, you pay the tag fees based on that amount.

Home Again

March 12th, 2009
2:40 pm

Hi Hillarie and others. We had the came of tax in PA. You will pay the 7% on the sales price of the car. So if were to buy my used mustang for $9000 you are going to pay $630 to the state. And for all of you that think selling your car to your spouse will solve your problem, nope! They will use a value estimator on the car and even if you only paid $4000 for a 1998 Cadillac they will charge you 7% of the value guide of $7000, or $490. Happened to me in PA. I showed them the checks and the contract and they said “fergetbouit, you gonna pay the tax or you ain’t gonna get the tag.” You have not seen the last of taxes and fees, more are on the way!

Native Georgian

March 12th, 2009
2:40 pm

Simply put: The bill discourages new car buying which is HORRIBLE FOR THE ECONOMY!

Woogidy

March 12th, 2009
2:40 pm

Easy fix people. Every car is bought for $1. That’s 7 cents tax. So when you buy a car from an individual, give him a couple hundred extra bucks and write whatever you want in the box that says purchase price. They didn’t think about that. I am from Indiana and everyone does that there. We WIN!

Bob

March 12th, 2009
2:41 pm

Thanks for finding yet another way to tax us! I’m beginning to hate the state government. The republicans are killing us average folks. I bet the car dealers will LOVE this. I can barely afford to get by as it is and now these stupid republicans are going to hit me again.

David S

March 12th, 2009
2:43 pm

Juat when are we going to do away with all of these scoundrels? Cut government, cut government, cut government. When are these jerks going to get it????

Rollo Tomasi

March 12th, 2009
2:43 pm

Someone had a good point. We could write the old tax off on our taxes. Will we be able to write the new one off as well? Anyone know?

CD

March 12th, 2009
2:44 pm

This is a CRAPPY piece of legislation!!!!! I mean totally WTF.. this means when I buy my 16 yr old a car/truck and have the title xferred to his name when he is old enough we’ll be taxed for the title xfer. Where is the “under the table” dealing here. I’m paying cold hard cash to a dealer or individual citizen, paying my taxes, title and tags fees but this isn’t legit b/c I didn’t go to Honda or Toyota.. Come one. I am the regular run of the mill EVERYDAY Georgian. I can’t afford to pay that amount for each of my children, when I purchase them a car/truck. I’m home grown but do I need to leave the new tax me state?

the truth

March 12th, 2009
2:44 pm

so in order to avoid the 7% tax can I simply go to a neighboring state and buy my car there?

Mike

March 12th, 2009
2:45 pm

Why does goverment feel they must pass new laws and senseless legislation every year. Our legislature would be surprised to know how many people would be satisfied if they went to Atlanta each year and did nothing. Give the state of budget to work with every year and let the Legislators go back to thier regular jobs.

Sense Common

March 12th, 2009
2:45 pm

Another issue, if you current have a vehicle you are paying for that will be paid off after January 2010, you will have to pay 7% to have the title perfected (meaning to have the lien holder removed). Remember, 7% every time the title changes except for deceased spouses.

And because this is a title fee, a purchase from a dealer can be wrapped into the financing (heck if they can add their crooked DOC fees, they can add anything). Many times when you buy a vehicle out of state (to avoid the DOC fees), the dealer will calculate the sales tax for Georgia and put it in the deal and cut a check for the State. Dealers will be able to do that with this fee. However if you buy from an individual (which 20% of sales are), you as the owner will need to fork over that 7% to get a title. That may not sound much, but if someone with poor credit has worked hard to save $4,000 for that car up the street, they now have to save a little extra to cover the $318 tag and title fee (280 + 18 + 20).

Nick

March 12th, 2009
2:47 pm

Hmm…sounds like this bill will stiffle car sales for the rest of the year, why would you buy a car this summer or fall, when you can wait until Jan and never pay advalorem…i wonder what new car dealerships have to say about this…

Paul A

March 12th, 2009
2:48 pm

Unbelievable…. Wait until these A-Holes figure out a way to tax everybody for yard sales.

If I buy a ferarri I only pay $2000 for tax.

Everybody should just create bills of sale for $50 when they sell a car via private party. If we all pay with cash how can these morons get their $$$$ ?

What in the fu** is the legislature thinking? Who do these a$$clowns think they work for?

Keep the annual tag fee. I don’t like it but it’s better than this BS.

It’s about time for a revolution ya’all.

To the GA legislature – STOP SPENDING MONEY YOU IDIOTS. Live within your means… That’s what the rest of us have to do.

Everybody reading this article should call their state Rep. and start yelling at them!!!

NO MORE TAXES!!!!!!

Justin

March 12th, 2009
2:48 pm

This makes no sense!! When you buy a car you pay taxes on that car whether you finance or not you still pay taxes on that car. When you renew your tag every year you pay taxes on that car. So when you sell the car to an individual the taxes on that car have already been paid at the time of pruchase and year after year. This legislation sounds like they want to double tax a car that has already had the taxes paid on it. This sounds fishy to me.

Janice

March 12th, 2009
2:49 pm

i’m completely confused. penalize the person who does not incur more debt by continually purchasing a new car. i give up….i am from the north and we had tax on top of tax…but i’ll tell you, georgia is catching up with these taxes on stuff.

Home Again

March 12th, 2009
2:49 pm

sorry “the truth” but you can’t title it in another state and get a tag in GA. The tax is in effect when you try to title it here in GA. And you can’t title it in the other state unless you own property in that state. You got to remember, these are politicians and they are going to figure out how to make sure you pay the tax.

Lisa

March 12th, 2009
2:50 pm

I dont think this is replacing the current sales tax you already pay on the purchase. It is an additional “title fee”. Therefore you will pay 13-14% in taxes and “title fines” over and above the price of the car. If they think this will help the auto industry, think again. How buying from an individual got to be an “underhanded” deal I don’t know. Basically, the government needs car dealers to collect their “fines” so they want to keep people away from individuals. I think this is called a private sale versus going to a dealership which should be called a government sponsored sale.

Jeff

March 12th, 2009
2:51 pm

C’mon Folks get on the phone and start making some calls! I already called Mr. Cowsert who represents Walton County and expressed my opinion. His admin didn’t know anything about it. MAKE SOME CALLS…IT’S THE ONLY WAY WE’LL STOP THIS GARBAGE FROM HAPPENING!!!!
Unreal…

Sense Common

March 12th, 2009
2:53 pm

From HB480:
(A) A state title fee in the amount equal to the lesser of $1,000.00 or an amount equal to 3.5 percent of the value of such vehicle as determined under the uniform evaluation of all motor vehicles prepared by the state revenue commissioner under Code Section 48-5-442; and
(B) A local title fee in the amount equal to the lesser of $1,000.00 or an amount equal to 3.5 percent of the value of such vehicle as determined under the uniform evaluation of all motor vehicles prepared by the state revenue commissioner under Code Section 48-5-442.

From OCGA 48-5-442:
Each evaluation shall reflect the average of the current fair market value and the current wholesale value for all motor vehicles as determined by the commissioner.

The $1 scheme will not work folks, so forget about it.

As to income tax, only taxes based on the value of the vehicle is deductible (remember this is called a fee which is different from a tax in legal terms). Also an income tax deduction exist for sales tax, but that will be gone to. So no deduction, except from your checking account.

Atlanta Blue

March 12th, 2009
2:57 pm

1. The 7% title tax REPLACES sales tax. So if you buy from a dealer, you are better off if you live in Atlanta (8% sales tax), worse off if you live in Cobb (6% sales tax).

2. If you buy from an individual, NOW you are adding 7% to the price that wasn’t there before, but you are buying your way out of the annual ad velorum tax. For most people, the 7% one time fee would be greater than the annual ad velorum tax, as we are talking about a used car (which already has lower ad velorem taxes than a new car of the same model), and most people not holding a car for the 6.5 year break even point.

3. The tax will be due on the FAIR MARKET VALUE of the car you buy from an individual, not on the actual price paid, or that the state will require an arm’s length transaction. The $1 for your car, $1 for mine, won’t fly. Bet on it.

You will never convince me the auto dealers weren’t behind this one. Purchases from dealerships, where the title tax replaces sales tax, will be close to a wash. It’s the private sales that will be killed by this one. And if private sales of used cars goes down, who benefits? Oh yeah, the dealers!

hillarie

March 12th, 2009
2:59 pm

You can read the legislation here: http://www.legis.ga.gov/legis/2009_10/pdf/hb480.pdf

@Lisa: It _is_ replacing sales tax and ad valorem tax: “any motor vehicle for which a title is issued in this state on or after January 1, 2010, shall be exempt from sales tax .. and shall not be subject to ad valorem tax”

Tax Man

March 12th, 2009
3:00 pm

There are multiple ways this tax will effect people.

It will remove sales tax from car purchases. Obama’s stimulas plan recently allowed for an above line adjustment for sales taxes paid on “NEW” car purchases. But this phases out for higher income people which many republicans are. Now the state won’t have to conform to this new rule because there won’t be any sales tax on auto’s.

This new tax will be labeled as a “fee” and will not be tax deductible. This raises income tax revenues for the state as well although minimal.

The obvious target of this is lower income people who buy used cars from individuals. Republicans always champion their fair tax system but i do not see fairness in the fact that the guy who buys a $15,000 car will pay 7% and a guy who buys a $100,000 car will pay 2%.

Stephen

March 12th, 2009
3:01 pm

I am terrified by the reasoning ability of people on here. If you are capable of understanding what you read then you will understand that this replaces both the sales tax and the ad-valorem tax. It is NOT in addition to sales tax. The rate they are using, which is 7%, is equivalent to the sales tax rate for the vast majority of consumers and is capped at $2,000, while sales tax has never been capped. Yes, the more expensive the car you buy the more advantageous it is for you. But it is not hurting anyone buying a new, inexpensive car. The break is just not as large. The only people this hurts are those who are buying a used car from an individual and those people have a legitimate complaint. Also, do any of you really think you can sell your car for $1 to a friend or spouse and then buy it back for $1 and avoid the tax? I beg you to try that. You will pay the 7% fee twice to have the car retitled twice. They use the prevailing market price of the car if your transaction price is significantly reduced. That is same way they do the ad-valorem tax each year. That tax has nothing to do with your purchase price. It has everything to do with the value they assign your car.

OMG

March 12th, 2009
3:04 pm

I pay $200 every year for both of my cars. If I keep these cars for 7 years I have paid $1400 in taxes. Most people do not keep there cars this long. So lets say I have my cars for 3 years. I have paid $600. If I go by two new cars the maximum I will pay will be $4000 ($2000 for each car). I do not see how this is better for anyone. Thank you Georgia lawmakers for doing your job and making sure that the state is well funded by taking more of my money just like U.S. lawmakers.

Sense Common

March 12th, 2009
3:05 pm

GADA (Georgia Auto Dealers Ass.) and GIADA (Georgia Indenpendent Auto Dealers Ass.) was very much behind this Bill. However the Representatives lied when they said they had support from County Tax officials. They realize this will increase the cost to their taxpayers while decreasing the collections by the local governments. People know this one fact if you know nothing else. The people under the Gold Dome do not care if local governments survive or not or if the schools are properly funded. Their goal is to look good and possibly move to a higher elected position one day. Your local government cares more about school taxes and local taxes than anyone else and they fight hard to keep those funds at a local level. Try attending a State budget hearing and have your voice heard. Now go to a local school board meeting or county Commissioner meeting. You may not get your way, but your voice will be heard.

KEEP THE MONEY OUT OF THE STATE AND FEDERAL HANDS AND LET THE PEOPLE DECIDE!!!!

Ace

March 12th, 2009
3:05 pm

So you buy a $20,000 car, you don’t pay the 7% sales tax, so you save $1,400 and you have to pay a 1 time fee of up to $2,000 at the time you register your car. If you finance your car, I’m sure this will be rolled into the financing just like sales tax. In the end you will probably break even in 3-4 years, so if you hold onto your car you will benefit from this law.

What I have a problem with is that the state has not been collecting sales tax on these person-2-person sales for all these years, when in fact they should have collected sales tax at the time the title was transfered.

For those who itemize their taxes, I wonder how this 1 time $2000 fee can be applied towards both federal and state tax returns.

Old Dawg

March 12th, 2009
3:06 pm

OK Georgia Taxpayers!! You’ve seen what the idiots do when they get under the golden dome. Do all of us a favor and please vote the bastards out at the next election. It is past time to take our state back from the tax and spend crowd. If we don’t do something about this now, they will just continue to take and take until there’s nothing left. As former British Prime Minister once said, “the problem with socialism is that pretty soon you run out of other people’s money.

Gary

March 12th, 2009
3:07 pm

I hope every one that is affected by this bill will remember the names of the representatives who created the bill at ELECTION time! Vote their sorry A$$&$ out of office next election!! They should have gone last November but nope we just had to vote Republican to try hold on, well folks need to remember what happened to the rest of the country! Now it’s happening to Georgia! The “good ole boys” are gonna screw us royal before it’s all over! Stock up on lots of Vaseline for your wallet!

Sad Truth

March 12th, 2009
3:07 pm

I’m sorry to tell you, but if you read the actual house bill (HB446) in its current form online, then selling your car to your wife, etc. for $1 will not work as the 7% is based on the “uniform evaluation of all motor vehicles prepared by the state revenue commissioner under Code Section 48-5-442″. In other words, no matter what you purchase the car for, the government is going to charge you taxes on what THEY think it is worth. And I see no provision in the bill for actually “phasing out” the ad velorum tax for those of us that already own our vehicles. We will be required to pay ad velorum taxes on our current vehicles until we purchase something different. So even if you purchase a car for $1, if it is valued at $29,000 or more, you will be paying $2000 in taxes.

Sense Common

March 12th, 2009
3:09 pm

BTW – the 8% sales tax in Atlanta does not apply to vehicle purchases. the 7% Fulton county rate applies. Current law caps the rate at 7% for large purchases.

Paul A

March 12th, 2009
3:09 pm

so my 2002 F-150 is a piece of junk.

The air conditioning is broken, the brakes are trashed, the windows won’t go down and the windshield wipers don’t work unless I step on the brake pedal.

The body looks great though … I figure my truck is maybe worth $1000 today, as-is.

Under this law the buyer would have to pay tax on the “fair market value”?
What if the vehicle is a POS like mine?
7% of whatever some a$$hole beaurocrat thinks it’s supposed to be worth?

On my way home tonight I should stop at Home Depot and get a pitchfork, torches and some gasoline cans. My next stop after that ought to be at Wal-Mart for ammuntion and a sniper scope!

Beware GA legislature…. You are on very thin ice!

Ima Nidiot

March 12th, 2009
3:10 pm

Since the 7% is based on the State’s value, not the selling price, the ’sell to wife for $1′ does not work. However, it still makes sense to sell your car to your wife. Here is the math:

My car has an assessed value of 8570, which would cost $599.90 fee to sell to my wife.

The current ad-valorem millage rate is 33.78 where I live, which means $289.49 AV tax this year.

Assuming I keep my car for five more years, and the rate of depreciation is around 5% per year. Over five years my total AV tax would be $1,300. The actual depreciation rate used by GA is closer to 3% per year, which would be closer to $1,400 for five years of AV tax.

If I kept my car for ten years, the total AV would be closer to $2,500, so paying a $600 transfer fee today will save almost $1900 down the road.

http://motor.etax.dor.ga.gov/forms/motor.aspx

Fulton Resident

March 12th, 2009
3:11 pm

Does anyone know the answer to this question. Is the legislature proposing to do away with both the state sales tax, which I believe is 4%, as well as any local option sales tax that is levied by individual counties? Can they do that? Or will those of us that live in counties that have a local option tax end up paying the 7% tax (capped at $2000) plus an additional 1,2 or 3% tax on the entire cost of the vehicle?

If the local option is also removed and the tax is 7%, I think this tax will have a negative impact on new car sales this year. Just want we need during a recession — a disincentive for buying a car! If the local option remains then this is one of the most deceptive pieces of legislation I have seen in a while.

Garrie Butts

March 12th, 2009
3:12 pm

What about boat trailers, motorcycles,campers and motorhomes. Does the same apply or did they even think about that. What about the people who trade cars every year? Talking about killing the auto industry, now people will drive their cars longer and not trade as often.

What were they smoking?

easy voter

March 12th, 2009
3:12 pm

Well election day will be easy this year….every incument will NOT get my vote. I’m glad I can work on my own cars since I’ll have to keep them alot longer.

David

March 12th, 2009
3:13 pm

At the dealer, you can FINANCE the sales tax into your car loan. But with this, that option would be removed and you’d have to pay a lump sum for the title fee at the DMV. On a standard $20,000 car, that’s $1,400 that you now cannot add into you financing and have to pay upfront at the tag office.

Independent thinker

March 12th, 2009
3:13 pm

This goes beyond stupid. Apparently, these legislators didn’t think beyond the ends of their noses. How much do you think it will cost GA to administer this program? Don’t you also think people will forge bills of sale and there WILL be deals “under the table.”

I normally buy used cars from individuals, as I find them more trustworthy and reliable than dealers. I didn’t realize I was dealing under the table! Where do I go to turn myself in? Same place legislators who don’t pay taxes go?

Jai

March 12th, 2009
3:14 pm

and now I see why alot of people keep their out of state tags. This system is jacked up.

David Gatch

March 12th, 2009
3:14 pm

Screw them all, just keep your car till its 20 years old and all you have to pay is a tag fee, not taxes anyway……..Heck if Cubans can keep their old cars running under Fidel, from the 40s and 50s running all this time why can’t you?

Sense Common

March 12th, 2009
3:15 pm

Paul A, keep your truck and you won’t pay anything (except the ad valorem tax you currently pay). Sell it and the buyer will pay the 7% fee. BTW – if your brakes are trash, you shouldn’t be driving it.

Another point on ad valorem. Currently if you disagree with your vehicle’s value (like Paul A), you can appeal to the Board of Assessors in your county and have the value adjusted to actual market value. Not so in this Bill since the value is not used to collect local taxes, the Tax Assessor’s Office cannot touch the value.

Lauri

March 12th, 2009
3:16 pm

The unintelligent quotes in the article aside; if I understand this correctly – the money raised will go toward a new state trauma center. Will you then vote to cut medical professional jobs and emergecy medical technicans? Do us “regualr folks” a favor and focus on important issues for the state of Georgia, such as improving our education system, or better yet – get the money from the government officials who DON’T pay their taxes.

kARL

March 12th, 2009
3:18 pm

Bobo!!! The Check!!!

Caren

March 12th, 2009
3:19 pm

You can finance the sales tax when you buy a new car now. So, just think of all the money the cities and counties will make on traffic citations for folks driving with no tag/registration, because I don’t know too many people in this economy that can afford to buy a new car and then come out of pocket another $2,000 for a tag. Way to go Georgia!!!

Steve

March 12th, 2009
3:20 pm

I love the part about if you are buying $150k Mercedes you are only going to pay $2k max in sales tax. Thanks for looking out for yourself (aka the rich) and screwing over the normal guy again!

Marie

March 12th, 2009
3:20 pm

Wake up GA Legislators and get a clue. When a person buys a car from a dealer and then sells it to a person “under the table” the tax has already been paid. What you want to do now is double tax that item. And if that’s good for cars why stop there. Make us pay a tax for any item that is sold individual-to-individual; that could include anything from used clothing to furniture to that used lawn mower sitting in the garage. Lets get a tax police that monitors every garage sale that is held across the state of GA and nab those “under the table” deals that us dirty low-down tax cheats are engaging in, arrest ‘em, and spit the pits of GA peaches at ‘em.

Before you start talking about “under the table” cheats ya might wanna git yo own houz in order and git rid of the tax cheats sittin at the table breakin legislative bread. What we citizens are hearin over the gossip fence y’all got a lot cheatin goin on under dat there gold dome.

common sense?

March 12th, 2009
3:20 pm

Typical Republicans, acting without thinking something through. Even a few Dems jumped on board as well. Why is our state government run by idiots?

This firestorm is just getting started. This bill will be dead within days.

Mike

March 12th, 2009
3:21 pm

For the generally upset out there lets clarify:

If you keep the car you have now, nothing changes.

If you buy a new or relatively new car from a dealer and keep it 4+ years you will come out ahead (based on metro Atlanta millage rates).

If you buy an older used car from an individual, depending on the county your “title fee” will be offset in as little as 3 years of no longer paying ad valorum.

I can re-post specific examples if you like but this is a reasonable deal due to the offset of the ad valorum, unlike the one a number of years ago where we had to pay sales tax on private sales.

There are 2 very valid points above though… It will be hard to finance the sales tax on a new car now if you use dealer financing (bank financing you can likely still do this), and the tax deduction of the ad valorum tax may not transfer unless we can get this “title fee” classified as something other than sales tax

crackbaby

March 12th, 2009
3:21 pm

This legislation is being pushed by car dealers and their lobbyists. Gov. Perdue should veto this bill. Car sales from one individual to another should never be taxed. Zell Miller stood up for Georgians when the state tried to collect sales tax on car sales by individuals. Your turn Sonny!!!

chase

March 12th, 2009
3:22 pm

@Yankee – My advice would be to avoid Alabama and Columbus.

Ima Nidiot

March 12th, 2009
3:23 pm

There are a lot of loopholes for the Ad-Valorem Tax:

48-5-470. Exemption of driver educational motor vehicles from ad valorem taxation
Driver educational motor vehicles are declared to be public property used exclusively for public purposes and are exempted from any and all ad valorem taxes imposed by any tax jurisdiction in this state.

So I am going to paint a really small ‘ACME DRIVING SCHOOL’ sign on the back bumper and stop paying the tax.

Sense Common

March 12th, 2009
3:23 pm

Oma Nidiot, Bad assumption on your math. The current assessed value is $8570, so the current FMV is 21,425. The assessed value for ad valorem taxes is 40%, the value for this fee is current market valuation. So your title fee is $1,499.75.

So hang on for at least 6 years to break even, providing you can afford to keep it running that long with emissions and other break downs.

Steve

March 12th, 2009
3:23 pm

Has anyone done the math on this? If you buy a car for $30k the fee will hit the cap of $2,100. If you are currently paying $250 per year in ad valorem, you would need to own the vehicle for 8.4 years to break even. Come on.. call it what it is… A TAX INCREASE… plain and simple.

woodie

March 12th, 2009
3:23 pm

House Majority Leader Jerry Keen (R-St. Simons Island) responded, “It is a tax increase for people who have been doing their transactions under the table.” So this genius thinks non-commerical sales are “under the table”. The only thing “under the table” here is you are raising taxes for everyone. Attempting to justify it makes you look dumber.

Allva

March 12th, 2009
3:25 pm

I would like to know from the person that said this bill would be more fair to “ALL”-how is that possible if you keep you car that’s only 1 or 2 years old and still have to pay taxes. Cars not really old enough to sell, but you would only get the tax break if you go crazy and buy a new car with the economy the way it is now, just so you can get a tax break. My tag only costs 20.00, so why do I have to pay another $235.00 additional for taxes? Where is the fairness in that?

willie

March 12th, 2009
3:26 pm

I always wondered when they would go after those taxes that weren’t being paid when a car was purchased from a private party. I have taken advantage of it several times, but I knew it would not last forever. I have friends in other states that could not believe we were getting away with that. Unfortunately, we won’t be anymore.

Bob

March 12th, 2009
3:27 pm

So if I buy a care for 30k from a dealer and decide I don’t like it and sell it to a private party for 30k a month later, the state has made 4 thousand dollars in 1 month. I’m very very conservative and generally side with the republicans on stuff, but if this and the $200 speed limit fine pass the Senate I don’t think I’ll ever vote republican again. Georgias legislators are insane. Libertarians here I come.

Sense Common

March 12th, 2009
3:27 pm

Mike, I think we have all established it will take 5 to 6 years to break even on individual sale. And if you financed the vehicle expect another 7% fee when the title is changed to remove the lien holder.

Really screwed by this

March 12th, 2009
3:29 pm

I just bought a car in January for $15000 from a dealer. I had to pay the 7% tax. Now I will have to pay ad valorem tax as long as I own it. How is this fair to me – getting double taxed like this when people that wait until next year get a free ride? Ad valorem should just be dropped. Double taxation is not fair. I don’t even see how this state gets away with it. No other state I’ve lived in taxes you annually on your car.

This is just NUTS.

Bob

March 12th, 2009
3:29 pm

And another thing. A poor working class family who buys a chevy malibu from a dealer will pay the same tax on it as a the baketball player rolling in a 500k rolls royce.

johnnyboy

March 12th, 2009
3:30 pm

Is this going to encourage people to buy in Alabama and Tennessee? Will I have to keep paying ad valorem but someone who moves here with my same year/model will avoid the tax?

Katie

March 12th, 2009
3:30 pm

Wow! That really sucks for people that purchased a new car this year to help the struggling American automakers (like myself). Make sure no one buys a new car this year and instead holds off until next year.

common sense?

March 12th, 2009
3:31 pm

Ima Nidiot,

Huh? Yes, selling you car to your wife now and not having a car for 10 years would be cheaper than having a car for 10 years. Is that really your argument in support of this bill?

sick and tired

March 12th, 2009
3:31 pm

May I say it as simply as possible? THIS SUCKS! This goes to show we have not spent enough on education in this state. I mean as far as voters and elected officials. WAKE UP VOTERS We need change!

George P. Burdell

March 12th, 2009
3:31 pm

Given the usual lack of thinking from our politicians, I’ll bet you anything they have run their revenue projections for the new tax based on current transactions. What will happen in reality is that the number of transactions will drop sharply as people will either keep their cars much longer or will find a way to circumvent the system.

I’ve owned my car for 10 years and the new tax would amount to a 27% increase. How do you think it works out for the average person who probably only keeps a car for 5 or 6 years, if that?

Just another classic example of the government wanting to get all the money up front. In a few years, when they aren’t getting the continuous revenue stream like they do now, they’ll come with another tax to make up for it. Count on it.

the Captain

March 12th, 2009
3:31 pm

So, lets see, a lower income person will pay a %7 tax if they buy a $20,000 car. Yet a rich person will pay a %2 tax if they buy a $100,000 car! So we see what the “fair taxers” really think is fair. But I’m sure that pointing this out is “class warfare”, but the tax isn’t.

high school teacher

March 12th, 2009
3:32 pm

“‘This is a great deal if you’re going to buy a $150,000 Mercedes because all you’re going to do is pay the $2,000 (fee),’ he said. ‘If old granddaddy wants to give his son a pickup truck, he’s going to pay a tax.’”

Well, that makes me feel so much better! Really? It saves money for those wealthy enough to pay the same for a car that many pay for a new house. How about us average Joes who buy $25,000 dollar vehicles? I can see people keeping their cars longer to avoid paying the new title fees.

Katie

March 12th, 2009
3:36 pm

By the way, I paid 7% sales tax on my vehicle a month ago and owe another $440 in ad valorem in a couple of months……and will continue to pay ad valorem as long as I own the vehicle….that is definitely evil

Troothsayer

March 12th, 2009
3:36 pm

Well, since Sonny is a lame duck, I don’t know if he’ll have the guts to veto this. This proves the argument that it don’t matter if it’s Republicans or Democrats, they are all out to redistribute the wealth. This really sucks. Take notice and vote out the incumbents next time.

Bob

March 12th, 2009
3:37 pm

Will someone please change the article title to

“THE GA HOUSE of REPRESENTATIVES VOTES TO INCREASE TAXES ON LOW INCOME GA RESIDENTS”

Please! It makes it seem like a good thing to have the title as it is. This a garbage bill and an inverse tax. What the heck are the ligslators thinking?

Sense Common

March 12th, 2009
3:37 pm

I’m not sure what States most have lived in, but according to a recent survey 31 out of 50 states impose some type of annual tax on vehicles. Some call it a “road tax”, some a “property tax”, some an annual “use” tax, some a “registration tax”, while others have more creative names. But an annual tax or fee in addition to a normal registration fee is charged in over half the States.

I will say this, a “check book” tax as i call it will always be the most unpopular tax. A “check book” tax is the one where the taxpayer has to actually write a check for the tax. Income tax comes out of your check so you never see it. Most homeowners pay a mortgage and the property taxes are escrowed into the payment. Sales tax is part of the business transaction for goods and/or services. Sin tax is figured into the cost of tobacco or alcohol products. Fuel tax is figured in the price per gallon. But the ad valorem tax requires the taxpayer to actually write a check from their account to pay.

shannon

March 12th, 2009
3:38 pm

Some of y’all need to think. This law is good IF you buy from a dealer. You will no longer pay sales tax nor a yearly tag fee. You will only pay the one time 7% or $2,000 fee. That will be a great savings…..especially if you buy a car over $30,000.

However…you get the shaft big time under private party sales. I bet the county will value the sale and NOT what the bill of sale shows. They aren’t always the smartest bunch, but they know that no one is going to sell a newer Corvette for $2500.

Whether you buy a car from a dealer, your neighbor, or a junk yard, you will pay the same amount…..new title tax, no sales tax, no annual tag fee

PMC

March 12th, 2009
3:39 pm

So if I don’t buy a car next year this is effecitvely worthless for me.

Vote no to incumbancy.

sickoftaxes

March 12th, 2009
3:41 pm

I agree with taxedtodeath. How silly is it to only make it applicable to those that buy new cars starting next year! I just bought mine 3 years ago and was planning to drive it till the wheels come off! I guess I will be paying the birthday tax for another 7-10 years. We all need to call our representatives ASAP and speak our minds.

Home Again

March 12th, 2009
3:41 pm

Why are you dragging the Fair Tax into this thread? This is not representative of how the Fair Tax would work. Under the Fair Tax the guy buying the $150,000 Mercedes would pay 7% just like the guy that is buying the Toyota for $25,000. Also, beware other “apples to oranges” comparisons as well. Just how many $150,000 cars do you think are sold in Georgia? With the new economy all of us will be looking at buying $20k cars if we are rich. Most of us are going to be unemployed!

Tami

March 12th, 2009
3:42 pm

Am I wrong, or is the federal government trying to encourage us to buy a new car and a new house for tax CREDITS?? But, Georgia wants to tax us on the very thing we get credit for from the federal government? If that’s the case, we just lost before we won. Darn.

Amy

March 12th, 2009
3:43 pm

Bobo, You can’t sell your car to your wife for $1 dollar and pay the 7% tax on $1. The tax office will tax you on the car’s value not the car’s sales price. Bummer, I know.

Mike

March 12th, 2009
3:43 pm

Several points:

Someone used the 30K car as an example.

If I buy the 30K car today I will pay $2,400 in sales tax (Fulton County) and nearly $500 the each of the first 4 years (whoever got 250 is not doing the math – 12K assessed at 39+ mils) for a total cost of over 4k in the first 4 years. under this plan I’d pay 2k total.

If I buy a 5K car from an individual I’d pay nothing to title it and 80 dollars a year in taxes vs $350 to title it under this new plan, so break-even is a bit more than 4 years.

As such the 5-6 year break-even on an individual sale is not correct nor is the assumption that this is a burden on the used car buyer (as if they bought the 5k car from A&A auto sales they are even in year 1…)

Troothsayer

March 12th, 2009
3:45 pm

And another thing, let’s hope the hero that sued the state and WON over the collection of taxes for private party transactions comes right back and does it again. Then maybe he can run for governor.

Josh

March 12th, 2009
3:46 pm

I have my ad valorem bills handy and I can tell you in my case I would have to keep my car for 6 or 7 years to come out ahead. Last year I bought a 1997 sedan for $9500. I am in Gwinnett so under this new legislation I would have paid $665 in tax when I titled the car. My current ad valorem bill is $93.40. Assuming that will decrease over the next 6 years it might even be 8 or 9 years to “break even.” I doubt this car will keep running for that long – already has 120k on it. I recommend contacting your senator and the govenor to let them know how you feel about this bill. It is easy to dash off an email…

Just stating the obvious

March 12th, 2009
3:47 pm

Once again those of us who live within our means i.e. buy a car we can afford, pay it off and drive it until the wheels fall off are screwed.
Thank you sir may I please have another!

Jay

March 12th, 2009
3:48 pm

Georgia is the only state east of the Mississippi that doesnt charge sales tax on casual sales (sales between individuals) and it is one of only three in the entire country that doesnt. It is a fairness issue not a sales tax increase. I think it is an excellent idea.

BAD DOG

March 12th, 2009
3:49 pm

Now I get it I can buy lottery tickets on Sunday (gambling) but I can’t drink. 8% jobless rate here but to avoid paying taxes on my car I need to buy a new one. GEORGIA IS ONE AZZ BACKWARDS STATE

Bob

March 12th, 2009
3:49 pm

I buy and sell about 2 cars each private party each year. This law is going to cost me thousands of extra dollars. Why should I be penalized just because I don’t want to hang on to the same car forever?

Sense Common

March 12th, 2009
3:50 pm

Let’s use the dealer sale. I buy a $25,000 vehicle and the title fee is and additional $1,750 which would be equal to the sales tax, so I’m at break even. Ad valorem tax is not normally due the first year unless your stupid enough to buy a couple months before your birthday. So for year 1 all is equal. Year 2, the normal ad valorem tax would be about $240 (20K vehicle (depreciation) X 40% assessment X .030 tax rate). Year 3 I save about $210 (17.5k vehicle), year 4 I save about $180, and finally year 5 about $150. So in 5 years I have saved about $780 and my vehicle is worth about half the price I paid (12,500). I pay off the loan and now have to pay another 7% title fee which is $875. So at the end of 5 years I have paid almost $100 more than under the current system.

Does this help anyone out there not understanding that “I’m from the Government and I’m here to help” (Ronald Reagan) is a scary thought?

Bob

March 12th, 2009
3:54 pm

So, if you don’t have a job, can’t buy a car and you are broke, you don’t get a break on Ad Valorem tax? Yea…that makes sense….

willie

March 12th, 2009
3:54 pm

Even thought Jay clearly works for a dealership, he is right. We were lucky to have the loophole on private party sales as long as we did. Having said that, they have to find a way to take care of people that recently purchased vehicles from a dealer.

Sense Common

March 12th, 2009
3:55 pm

Mike the sales tax rate in Fulton for vehicles is 7%, and the average millage rate for all of Georgia, not just your little world, is about .030. Also your 20k will will depreciate each year to about half as much in 5 years.

Rodney S.

March 12th, 2009
3:55 pm

The article isn’t clear on very much. Does this do away entirely with sales tax on cars (in my county that’d be 7%) or does it just remove the state’s portion of that sales tax (4%)? If it’s doing away with that entirely, then my county loses the 3% it would have collected otherwise. I don’t mind the idea of capturing revenue from personal transactions (seeing as how I have always bought new) but I can see how local counties would be upset since each county sets its own mileage rate.

Clearly this bill favors buyers of expensive that are over $30k in value… in that sense the fee seems very regressive. I’m all for getting rid of the birthday tax, but this is NOT how I envisioned that being done.

Georgia Gal

March 12th, 2009
3:56 pm

Okay, I have a 2006 car which I’ll hang onto for at least 2-3 more years, because I can’t (nor do I even want to) afford to buy a new car in this economy, so I’ll still be paying the tax. They should have just cut out the tax altogether. I don’t have a problem paying the 7% when I buy a new car … its better than paying that bill every year on my birthday (Happy Birthday!! You owe the government a few hundred dollars), but until I buy a new car then it appears that I am stuck with it.

Bullseye

March 12th, 2009
3:57 pm

Do I have to pay any tax if my tag is a brown paper bag with tag applied for?

Harold

March 12th, 2009
3:58 pm

7% of what? The sales price? I will be selling $100 cars and taking mandatory gifts of $thousands.

LMS

March 12th, 2009
3:58 pm

What happened to Republicans being against tax increases???

Sense Common

March 12th, 2009
3:58 pm

BTW – Casual sales tax was in effect until 1993 or so and was being challenged in Court to the legality. The law was over turned before the Court could do so by Legislation. Unless a sales tax credit is given to the original owner at the time of sale (like it is when traded to a dealership), sales tax can not be charged again. Other states do not give sales tax credits on trades, so that may be how it is legal there.

Question

March 12th, 2009
3:59 pm

Sense Common- Why do you have to pay another 7% when you pay off the loan? Your $875 in your example.

gacowboy

March 12th, 2009
4:00 pm

Sounds like some politician’s friends got their hands in the cookie jar again. As for Dumba** Porter, Old granddad has probably been paying the ad valorem tax on that old truck for years, he deserves a break. Maybe folks will just keep the cars they have and let the dealerships run out of business until the stupid politicians come up with something else. Nah that won’t happen…too many stupid georgians can’t go without that new car long enough for that too work. Quit complaining about the stupid politicians and vote them out.

Brad

March 12th, 2009
4:01 pm

Is Flyin’ Dawg the only person on this blog who has a clue. No wonder Georgia schools are near the bottom of the charts, read the BILL PEOPLE, your going to save money.

DISAPPOINTED

March 12th, 2009
4:01 pm

This new legislation is OUTRAGEOUS!! I was looking forward to the former proposed plan: TOTAL elimination of the property tax in 2009 so that purchasing a new car would be a pleasure. I have always viewed the property tax as ridiculous, unnecessary. Why was the plan changed? Apparently, the legislators dupe their constituents again.

We should all protest!

No money saved

March 12th, 2009
4:03 pm

Brad- how crazy of you to claim we will save money! I purchase different cars about every 2 or 3 years from private sellers on craigslist. I sell the same way. Tell me here how I’m going to save money. I challenge you.

Sensible Idea

March 12th, 2009
4:04 pm

What they should do instead is collect a 7% fee on the casual auto sale when it is titled, which currently is not taxed, leave sales taxes alone for new car sales and eliminate the annual ad valorem tax for all.

As it stands now the person that simply wants to keep their car continues to pay annual ad valorem tax indefinetly. The new car buyer pays a one time 7% fee capped at $2000, which is no different than today when they pay a sales tax at purchase except it capped, and never pays anymore annual tag fees.

Very unfair tax for us people who want to keep their current car.

No new car sales in 09

March 12th, 2009
4:08 pm

If you buy a new car in 2009 you are an idiot. I thought the government was going to try to encourage sales, not discourage them. Either way you will have to pay 7% tax, but if you wait until 2010 you won’t have to pay the birthday tax. Why would anyone in their right mind buy a new car for the rest of the year? Do the politicians think before they pass legislation?

screw this

March 12th, 2009
4:08 pm

It’s been fun paying taxes here. Im ready for the Union of Texas with Chuck Norris for Prez — loolsauce. Both political parties are sadly out of touch.

John

March 12th, 2009
4:08 pm

The way I understand it is that this “New Tax” replaces the sales tax you would normally pay for a dealer purchased vehicle in additon to replacing the current “b-day tax”. That said; you would now need to pay the “New Tax” which is 7% of the vehicle “value” or a maximum of $2000 when you title the vehicle in ga. This is a savings for people buying cars whose “value” is $28,571 or more. This is an increase for people who purchase cars from individuals depending on the “value” of the vehicle and how long the buyer expects to keep the car.

Government Mule

March 12th, 2009
4:09 pm

Another fine example of our government in action! Thanks for the non-deductable tax, I was really looking for a way to give you guys some more of my hard earned money…I’m glad you took care of that for me! What a bunch of worthless turds.

Chris

March 12th, 2009
4:09 pm

I agree with most of what’s said on here – this thing is dumb and screws over most of us. My wife and I just bought new cars this past summer (had to trade in the motorcycles when we found out she was pregnant) and we are screwed all the way around.

What would be perhaps a better fix would be letting people set their date the tag taxes are due. The birthday rule isn’t necessarily a good time for people. What if your birthday falls right before Christmas – you get drilled right when you are trying to shop for your kids. For me the birthday thing is a killer because I’m a teacher. I go from about Dec. 15 to Jan 31 on 1 paycheck – that means 2 mortgage payments, 2 car payments…2 of everything payments, plus Christmas….and my birthday is Jan 31st. So birthdays are awful for me. I appreciate the effort they are putting in here but this solution they are proposing is trash.

Dan Greenfield

March 12th, 2009
4:11 pm

Without knowing the the details, it sounds like it’s going to discourage new car sales. That $15,000 Nissan doesn’t look so good if I have to write a $1,000 check to the DMV instead of having $1,000 in sales tax financed into my purchase.

GoodScout

March 12th, 2009
4:11 pm

ProgressivePeach.com has it right: This is just a tax break for the rich and a new tax on the poor!

Vote Them Out of Office

March 12th, 2009
4:12 pm

Just keep a list of the clowns that vote for this legislation and vote them out of office when the next election comes up.

Under this bill my son would have to pay 7% if I sell my old beater car for $100 to him to drive as his first car until he gets some experience. That is stupid

matt

March 12th, 2009
4:13 pm

It is getting dangerously close to the point where people are going to be protesting in front of the Capitol. Of course they will probably just start tazing dissenters, forgetting the fact that our nation was founded by a group of them.

Not So Rich

March 12th, 2009
4:14 pm

I love how the politicians are that stupid that they use “the guy buying the Mercedes” as an example of how this is a good thing! Yeah, great for the wealthy guy buying the Merecedes, Ferrari or Jag but not for the average Joe that barely scrapes enough money to buy a used vehicle from an individual. Could we not just sell booze on Sundays and make the extra tax revenue that way! Idiots

stan

March 12th, 2009
4:14 pm

Thank Georgia Auto Dealers Association and other high paid lobbyists for this Screw-Up. Once again the people that work for everyday wages take the brunt of the problem. Wonder if they are giving a free sample of KY or Astro Glide with every new title?

Kathryn Whaler

March 12th, 2009
4:14 pm

This is not only sticking to the people who can not afford to buy a new car but it also further takes revenue from the counties and school boards. Which will make it impossible to keep property taxes down. Just ask your county tax commissioner how much revenue comes from the birthday tax then you’ll know how much the county and school board need to make up in property tax or cut services- fire, police, ems – just pick one. This is a horrible idea and a sneaky way to get the public’s approval without their understanding the consequences.

Kevin

March 12th, 2009
4:19 pm

Pure and simple, they are finally (after years) trying to capture the revenue lost from individual sales. If you buy from a dealer, you are getting penalized due to the lack of ability to roll this into onsite financing and losing your tax deduction. Otherwise, it is actually better in the long run.

In terms of individual sales, it is only right that people who sell multiple cars a year should be treated somewhat like a dealer. On the other hand, they should have left the one car a year folks alone. If they are going to impose this fee, then they should increase the requirements to sell a car to give buyers more protection. They are happy to get the money but have done little to protect buyers from all the used car fraud.

The bad thing is this opens up the door for them to put a “fee” tax all sorts of tangible sales (if they can find a point of collection)…ebay anyone?

Also, remember on trade-ins you can reduce the taxable portion of your new/used car by the value of your trade in. Does this reduction also apply to this “fee”?

TA Cover

March 12th, 2009
4:20 pm

The mercedes comment says it all. Well off folks will save a ton, $2000 max cost for life of the car versus the old sales tax plus annual ad valorums. Cutting the 5% sales tax alone saves $3000 on a $100,000 car.
The average Joe gets screwed. Buy a used $5000 clunker and pay an extra $350 up front, which Joe can ill afford. VOTE all the idiots out of office. These legislators are NOT doing the average person any favors, just shifting the tax burden downward on the income scale.

Mad as H**k!

March 12th, 2009
4:23 pm

Find your representative and email them…..
http://www.legis.state.ga.us/legis/2003_04/house/index.htm
This is ridiculous!

Bubba

March 12th, 2009
4:23 pm

POLITICIANS ARE A PATHETIC JOKE!!I SAY WE VOTE THEM ALL OUT AND REPLACE THEM WITH REAL WORKING MEN AND WOMEN!!

Jim

March 12th, 2009
4:24 pm

The AJC really needs to change the headline to reflect the fact that they’re actually not talking about ending a tax, this is a TAX INCREASE! Not only that, it’s going to hit us all at once, the minute we title a car. WRITE SONNY NOW, AND GET THIS KILLED.

If they just want to tax person to person sales, fine, when you go to title a car, if you can’t show a tax paid invoice from a dealer, THEN you’d pay. but it’s not going to help dealers sell thirty thousand dollar cars when customers KNOW they’ll have to cough up two grand cash just to drive it.

Sense Common

March 12th, 2009
4:24 pm

To “Question”: The Bill requires a 7% fee on the market value eah time a title is issued. When you pay off the bank for your vehicle they send you the title, but the title stills shows a lienholder until you have the title “perfected”. Meaning a new title is issued which means another 7% fee. You can not “perfect” the title and avoid the fee, however if you lose or misplace the title you will have to get a letter from your creditor showing the lien was satisfied to get a replacement title (which I’m not clear if this is subject to the 7% fee or not since the Bill failed to address replacement and lost titles).

Steve

March 12th, 2009
4:25 pm

I like to get a new car every three years. I dont do my transactions under the table. How is this a savings to me? Also, my current car would have had a fee of $1780. Since this isn’t added to the cost at the dealership, I can only assume that we will no longer be able to finance the tax. So where exactly am I supposed to come up with $1780 to title my car at the tag office?

Steve

March 12th, 2009
4:26 pm

Ok… so if the sales tax portion goes away and you trade in a car for a new car, do you pay tax on the total sticker of the new car or only on the difference between the two?

In which case my trade is now worth $28,000 and the new car is $2,000. :-)

Not So Rich

March 12th, 2009
4:29 pm

Good Point Jim! How can they raise an additional 100-150 million per year and NOT call it a tax increase? This is so stupid.

Katie

March 12th, 2009
4:32 pm

Sensible Idea,

That is exactly what I suggested to my reps (in an email)! Collect sales tax on private party sales when they go to transfer the title. Leave sales tax as is (without that $2,000 cap) and get rid of ad valorem for everyone. That sure sounds a lot more “fair for everyone” than the representative’s poorly thought out plan…..

Jaye

March 12th, 2009
4:34 pm

Everyone who is so upset now just needs to remember the feeling next time your representatives are up for re-election.

Matt

March 12th, 2009
4:34 pm

Let’s face it, we can’t even blame these a-holes because we’re the a-holes that gave them the authority to tinker with our current laws/taxes. I’m done voting. Maybe if no one gets elected and the incumbents are ran out of town we can finally dictate our own lives. VIVA LA REVOLUTION!!

Bring Me the Head of Deforest Kelley

March 12th, 2009
4:34 pm

From a previous comment: “You have to wonder if these elected idiots really think about the big picture before they speak/vote ……”

But who are the idiots who keep electing these people into the legislature? This bill is just another example of Georgia politicians doing what they do best – taking something that isn’t broken and ‘fixing’ it until it is.

As idiotic as the state legislature may be, we’re the real idiots for continuing to re-elect them.

Hug my root Legislators

March 12th, 2009
4:36 pm

Great thang they don’t tax the air we breath…They tax everything else and then make up new ones to improve the “screw me more” job…
Please notice, Anytime the screw man wants to screw someone more of their savings it’s an average American not the Wealthy and rich..How do Americans elect such inteligence and such Good Americans…Please put a nail in this idea and let’s find away to help the Common Georgian..We work for what we got and we don’t tax Americans into the poor house…

Frank

March 12th, 2009
4:37 pm

The legislature has found a way to further drive down new car sales…keep my car and pay the downward property tax as my my ages or pay an additional $2,ooo to title a new car (given that the average new car purchase is over $25,ooo).

Just another way to raise tax revenue and not reduce government and govenment expenses. Just like a heroin addict except these addicts are our legislatures and the drug is bigger, more expensive government.

Jack Stilton

March 12th, 2009
4:39 pm

I miss the good ole days when we stood in a long line at the courthouse on the last day of April every year!

Jay Phillips

March 12th, 2009
4:40 pm

I dont think many of you understand this or read it closely.

Right now, if you buy a new car you pay sales tax, which is generally 7% in most of Georiga. You ALSO pay advalorem taxes EACH year on your birthday – the so called birthday tax. This new laws says that you will NOT pay the sales tax NOR the advalorem tax, BUT INSTEAD you will pay a ONE TIME 7% fee, capped at $7000. Sounds like a savings to me – but than again, I did pass 1st grade math!!!!

Kathleen

March 12th, 2009
4:40 pm

I never heard of a tax on a car before I moved to Ga. Now you want to tax transactions between citizens – in addition to re-instating a tax on groceries. What’s next – a tax on garage sales?! Come on you guys – you are supposed to be working FOR us. Do something that really helps the citizens of Georgia in this horrendous economy. We are not as dumb as you think.

Mad as Hll

March 12th, 2009
4:41 pm

If you wanted to do it right have us who are struggling anyway stop paying he Tax on our Birthday. The Republicans have done it again, SCREWED US. I have to go out and buy a new car for relief, I just brought a new car.

Jay Phillips

March 12th, 2009
4:42 pm

Opps, meant to say capped at $2,000. My first grade math again!!!

Sell for a dollar

March 12th, 2009
4:46 pm

What is to keep you from selling your used car to another person for ” $10 ” from the standpoing of the title, then receiving a $10000 tip for delivery? Looks like the title fee would be about $0.70

Kevin

March 12th, 2009
4:46 pm

Trying to offset costs=Fee
Trying to generate revenue=Tax
Call it what it is or call in unconstitutional.

David

March 12th, 2009
4:48 pm

Well, once again our illustrious, elected officials have found a way to screw things up. If you’re going to do away with the “Birthday tax”, you need to make it for ALL, not just for those buying a new car next year. This is an idiotic idea and I will remember those who voted for this come next election! Tax relief for SOME, is relief for NONE!!!

Doug K

March 12th, 2009
4:50 pm

Hey Jay,

It’s a fairness issue alright! It’s not fair that I have to 7% on my middle-class car while the rich pay less for their upper-class car. Address that fairness issue!

Retro Sonny

March 12th, 2009
4:50 pm

For those of you who bought a car this year. Maybe Sonny Perdue bought one this year too. If so he will make the bill retroactive and therefore you can get in on the savings too.

Sense Common

March 12th, 2009
4:50 pm

Jay go back and read an earlier post. It isn’t that simple if you take the vehicle out for 5 or 6 years. Besides look at this was. The Representatives pushing this state “the local government will maintain their current tax base and the state will gain 150 million for Truama Care”. How can an addittional $150 million be raised without someone paying more?

Math is good, but maybe a little lesson in Political Science or History was in order.

Jim

March 12th, 2009
4:51 pm

So if I’m single and own my car free and clear and then I get married after this law is enacted, will I have to pay 7% if I have my car retitled with my wife’s name on it?

Dawn

March 12th, 2009
4:52 pm

Did any of you folks read the whole article, or did you just pick out the parts you don’t like?
1) Instead of paying your county sales tax rate at the time of purchasefrom a dealer, you will pay a flat 7% ($2,000 Max)tax. You can still finance that amount, just as you could with the county sales tax.
2) Most dealers collect for tag & title fees ($38) when you make a purchase and remit those fees directly to your county when registering your car for you.
3) The dealership currently remits the County Sales Tax it collected from you to the the State of Georgia on your behalf.
4) Nothing changes. You pay the flat % tax at time of purchase plus the tag & title fees and the dealer will remit those monies along with the required paperwork to your resident county and register & title your car. NOTHING CHANGED HERE FOLKS.
5) Why shouldn’t casual (person to person) sales be subject to taxation? You buy used furniture at a second had store and have to pay county sales tax. What makes a car that different?
6) And don’t think for one minute you can sell your car for $1 or give it to your kid, the counties already place a value on you vehicle based on Kelly Blue Book. That will not change.
7) I for one would look forward to not having to stroke a check each year to Cherokee County for 3 vehicles that I own. Though they are not expensive cars, it is just a yearly reminder that government has you by the b-lls. But should I decide to trade/sell/replace these cars, I would rather get hit just once and move on.

Kevin

March 12th, 2009
4:52 pm

JayPhillips is correct.

For most people this is a good thing.

Until you buy a car nothing changes.

New Way – Buy a new car-7% with max of $2,000
Old way – Buy a new car-Sales tax (5,6, or 7%) AND annual property tax

New Way – Buy a used car from dealer-7% with a max of $2,000
Old Way – Buy a new used from dealer-Sales tax (5,6, or 7%) AND annual property tax

New Way – Buy a used car from individual – 7% with max of $2,000
Old Way – Buy a used car from individual – Notta

There are some quirks such as financing, reducing trade-in value, and having to pay up front that should be considered.

Bill

March 12th, 2009
5:17 pm

So if I give my truck to my grandson and it is valued at $10,000 it will cost $700 just to transfer the title. What a horrific bill. The car dealers must have paid a fortune to get this crap passed.

AJ

March 12th, 2009
5:27 pm

These laws make me want to go into Government because clearly the people we elect are STUPID. I bought a car in May 2007. I paid sales tax and I pay the ad valorem aka birthday tax. So, if this law passes, I pay this tax EVERY YEAR? Are our elected officials so dense that they can’t see how inequitable this law is? Others have also expressed other valid issues. Our legislators come up with laws at a whim and don’t think them through. Clearly, the lower your IQ, the better chance you have of being a state senator or representative. Sad.

Buy my M3

March 12th, 2009
6:22 pm

This sounds like it’s really only going after the private party sales where no sales tax is paid.

I’m looking to buy a 40,000 car now. If I purchase today (at a dealer) I pay Gwinnett county sales tax 6%, $2,400. And then every year pay ad valorem tax on my birthday (which is 4 months away).

If this passes then next year I buy the same $40,000 car (at a dealer) and pay 7% “fee”, $2,800. But it’s capped so I pay $2,000. Save $800. And no ad valorem tax every year.

Did I get the math right?

Problem is I’d have to wait till next year. And the $2,000 fee comes out of my pocket unless I can put into the car loan.

D&M

March 12th, 2009
6:23 pm

It sounds like the legislature is out of touch with the regular Georgian! If they want to ’stimulate’ the economy, do away with the birthday tax all together.

DKW

March 12th, 2009
6:59 pm

Folks for God’s sake pull your head out of your butts and shake the crap out of your ears and think about what you are saying. Has anyone picked up a pen and paper and done the math on this one?
I did and this is what I found out. In 2003 I purchased a 7 year old truck and a 4 year old car. Since then I have paid $2,445.49 in taxes on them and in a few months I have to pay more taxes even though I just took a 20% pay cut in order to keep my job. If this had passed 6 years ago I would have already saved $445.49, not to mention the $150.00 I’ve got to pay out on my next birthday.

Marie

March 12th, 2009
7:06 pm

Absolutely not! I can’t afford that kind of tax. Yes, we need Trauma Care. Add $5 per vehicle per year to the registration fee. Add higher taxes on cigarettes. Yes, charge speeders doing over 85 a higher fee. If you don’t buy your vehicle from a dealer (so you don’t get taxed); add a small fee to get it titled. Add $5 per year to everyone’s real estate property taxes. I’ll gladly pay those fees.

Tired of this S%*t!

March 12th, 2009
8:23 pm

Bastiges.

They should all be voted out of office!

Studebaker Man

March 12th, 2009
8:44 pm

Who does this help? The rich again! The $100,000. Mercedees taxed today would be $7,000.00 but it will be $2,000.00. People (rich) buying the high priced auto will come out good. The Mercedees dealer can offer $5,000.00 discount deal the minute it becomes law. The “RICH” man does the dancing & get the deals & the poor man pays the fiddler & fusses about it & goes back & votes them in again next election – you can fuss all you want –I believe you must really like it (being reamed) or you would change out the House & Senate We are some dumb folks. You don’t really think that Jerry Keene just didn’t think this through do you? Of course not –Hey – he is a Mercedees man — DUH – DUH. We Republicans have a lot of crooks amoung us too – From Sonny Boy on down.

Studebaker Man

March 12th, 2009
8:52 pm

Sure you can put the $2,000.00 or any amount of tax in the financing then just like you do now. The dealers gets it financed & sends the money to the state all at once – just like now – Dearlers are responsible for collecting the tax & getting your tag anyway -unless you want to pay all at once. Us poor folks have to “get it all financed”. That part will not change. Right???? Come on you car dealers — I know you are laughing your A$$ off — but tell us.

Jerry

March 12th, 2009
9:06 pm

First of all I am a third generation car dealer and I am AGAINST THIS BILL! I have read the bill many times and it will kill used car sales and new car sales. The banking industry would also be affected by this(I bet they don’t even have a clue about this bill).

1. As a dealer if I sell you my car cash, I am only required to give you the title. As I said earlier, I have been in the car industry all my life, and yes, I have seen some sleazy dealers. You (an elderly woman) buy a car from one of these sleazy dealers for 10,000 out the door. But guess what, when the woman gets to the tag office to get her tag lo and behold its 738 dollars more. She goes back to the dealer, guess what? He is only required to give her the title, it is then on her. I do not want to see that happen.

2. Trade in value erased

Lets say you have a tahoe thats worth 30,000 and you now need a truck so you trade it in on a 32,000 truck. Under the old system you would only pay sales tax on 2,000 which in my county would be 140 dollars. But now you would have a title fee of 2000 dollars(max. allowed). So you wouldn’t be trading for 2140, but for 4000 dollars. I bet that got your attention.

3. Lets say you need a 3000 dollar loan from your bank. The bank wants collateral. You have a paid off second car thats worth 5000. You use the title for collateral to get a better rate. The bank would now title this car with their lien. Guess how much it costs. Old system, 18 dollars. New system (use value of 5000) 368 dollars. So you loan would now go up 350 dollars plus the interest on the 350 dollars.

I can go on and on. I have made many calls to Atlanta tonight, and I have had a positive response, these were all points that were not brought up before the vote.

I think when the car dealers fully understand how this would affect them, they wouldn’t embrace it.

MATTinATL

March 12th, 2009
9:36 pm

The only thing that needs to get axed (e.g, elections or guillotine.) is every mindless representative who voted for this crap piece of legislation.

Atlanta Blue

March 12th, 2009
10:20 pm

1. Why title the car a second time when you pay off the loan? There is no need to have the title “perfected”. The leinholder signs off on the lein, and you are free to sell the car using that title. No need to have the leinholder officially “removed” until the car is being sold to a new owner.

2. You will absolutely be able to finance this fee when buying a car from a dealer. Right now, when you buy from a dealer, if you finace the purchase,you finance the fees charged by the state (the dealer pays them on your behalf) just like you finance the sales tax. you don’t write separate checks to the DMV, the dealer pays the fees and puts them into the final purchase price.

Much panic over nothing IF you buy from a dealer. In fact, if you buy a new car from a dealer starting in 2010, this is a GREAT bill.

Terrible bill if you buy from an individual, unless you hold the car for 6+ years (on average).

Now, take a WILD guess who was behind the passage of this bill.

George Washington

March 12th, 2009
10:35 pm

Can we just legalize weed instead and let the government sell it?

todd

March 12th, 2009
11:40 pm

OUR LEGISLATORS ARE IDOTS

DOUGLAS

March 13th, 2009
2:08 am

Let’s stop this stupid legislation. Here is link to every Georgia Senator’s email. Blast them hard, tell to stop this bill when it gets to the senate. http://www.legis.ga.gov/legis/2009_10/senate/senatelist.php
Also contact, Casey Cagle & Sonny Perdue.

Swilli

March 13th, 2009
5:53 am

So they just killed car sales for this year. And how does ths help the middle class consumer? I am glad the people that do person to person sales are honest enough not to give a reciept saying they sold the car for 500.00 even though wink wink it is worth 10,000.00.

New Tax

March 13th, 2009
7:33 am

They did away with a tax and yet are raising more money for the government. Madoff should have taken lessons from the scammers we have posing as legislators. Vote the bums out of office.

No WMD's

March 13th, 2009
7:35 am

Gee, and I thought the Repugs were the ones that wanted less taxes…I guess by calling it a “fee” they figure people won’t consider it a “tax”. Seems like failed Reaganomics to me where he put in place “revenue enhancements” instead of taxes. I have no problem with rich people….I’m working hard to become one, but I hate lobbyists and politicians who have power, abuse it and stick it to the common person. That’s not hate for the rich, but hate for the greedy sons of b*****s.

Paul Broni

March 13th, 2009
7:36 am

How does this hurt new car sales? It doesn’t. When you buy a new car, you’re paying sales tax on it anyway. And you can be sure that if you finance the car, you can roll the sales tax in, just as you’ve always done.

I’m not sure I follow the logic about capping it at $2,000. It should just be 7% across the board. Isn’t that the way it is now?

Seems like the only people being “hurt” here are ones doing private sales. Yes, it stinks that they’re collecting a tax on these sales, and yes that does take a small advantage away from buying a car privately, but does anyone know what the percentage is of these private sales compared to dealer-led transactions? I can not imagine that it’s very big.

Still, it’s designed to raise money, so there’s clearly cash being taken from someone’s pocket.

I do hope that there will be some allowance made for bona fide gifts of cars between relatives.

Phil Smith

March 13th, 2009
8:09 am

How about people who have Camping trailers and Motor Homes? These have very high ad-valorum/birthday tax each year and they are not traded out as quickly as Autos and Trucks. The tax on these can be as high or higher than the $2000.00 limit but that is each year. This can cause problems as a challenge to the taxation equality question.
Phil Smith
McDonough

concerned gwinnett

March 13th, 2009
8:14 am

Why do you have to keep paying sales tax over and over each time the car sales. Sales tax should be a one time deal for any item. Call it a transaction tax. I call it b@llShlt. These baffooons are so desperate for money because of their wasteful ways that they will now do anything. Reminds me of the old adage.. you can put whipped cream on a turd but it is still a turd

Mike Hale

March 13th, 2009
8:41 am

Why do you want to blame car dealers for the idiocy of our legislators. We do not benefit from any sales taxes we collect.

scott

March 13th, 2009
8:41 am

These Republican idiot have just raise taxes on the poor and middle class citizens in this state , they have made use car salesman’s obsolete . this is deja vue first this legislation voted to have the tax payers of this state pay for a power plant that haven’t been built yet and now this . The voters in this state need to wake the hell up come 2010, 2012 and vote all these republicans idiot out of office they don’t care about the middle class they are only looking out for the rich ,how typical . Turn Georgia Blue !

Don Byers

March 13th, 2009
8:45 am

When will we learn that the Republicans will always gouge the working man? Time to pay the fiddler so quit complaining….oh, yeah, I voted Democratic…but I’ll have to pay if I buy a car…
Hillcat

Michele Dennis

March 13th, 2009
8:53 am

If this tax idea is so great, how is it generating so much more money? Because it is aimed at the middle class who have to carry the brunt of the tax burden. Thw car dealers and auto lobbyists should be very happy. I am getting really tired of these legislators telling me that these laws are in my favor. Don’t do me any more favors! I can’t afford it.

Steve

March 13th, 2009
8:54 am

Gee, and this is coming from the TAX HATING REPUBLICANS…….you Repubs are a joke, but worst you’re HIPOCRITES,clowns have been in my pocket more than a pick-pocket.

David

March 13th, 2009
9:11 am

To Yankee, Owning your home in Georgia and buying your tag in Alabama can get you a Fat ticket. If you own property in Ga. and file for homestead tax exemption then buy your car tag in Alabama, you can also go to jail for “tax evasion”, and that is a criminal offense. As a retired officer I have worked “TWO” of them!

John

March 13th, 2009
9:46 am

How do they handle people moving into the state? Will they have to ante up again? Naturally, all the Democrats are for it. What a way to treat the people they are supposed to represent. They won’t be happy until everyone is broke.

Len

March 13th, 2009
10:09 am

Don’t worry about it, the Senate will take care of us.
The $1.00 deal between you and your wife will be changed to “Fair Market Value” or Kelly Bluebook. So instead of 7 cents it will be $700.00

Sense Common

March 13th, 2009
10:16 am

First off, this isn’t a Republican .vs Democrat thing. Heck for 2 many years you couldn’t tell who is who in the Gold Dome. Zell was more conservative than Perdue ever will be, however Zell is Democrat and Perdue claims to be Republican. Barnes was the only honest Governor about his party in the past 15 or so years. But this isn’t the Governor’s Bill either (he hasn’t stated his position, but I bet he opposes it).

And I know it is hard to read all the post, but “a third generation dealer” named Jerry made some very valid comments (maybe he can get GADA and GIADA to remove their support and this Bill will probably die). No one has thought about the true cost to purchase a vehicle. Like Jerry stated currently when you trade you are allowed an allowance for sales tax. So a $12,000 used vehicle traded in on a $30,000 new vehicle is subject to a sales tax of $1,260 at 7%. However under the new law the title fee would be the max of $2,000. Folks that is a normal day to day transaction.

And no one has addressed lease deals yet. Currently a leased vehicle is subject to a monthly sales tax based on the monthly lease payment. Meaning a vehicle with a $400 payment pays $28 a month. Over a 4 year lease that is $1,344. But now that will be base on the orginal value of the vehicle, most of which will fall into the $2,000 category. And that is up front, so forget about those no money down or low down payment deals. And do you think the lease company is going to want to eat the title fee when you turn the vehicle in? Get ready for some huge “turn-in” fees.

And someone ask why you would “perfect” your title. If you keep good records and have a safe deposit box to keep your title, there is no reason to do this. However most people may have a hard time finding the title when they get ready to sell or trade. In that case you have to apply for a lost title (7% fee?)and contact the lenging institution for a letter releasing your lien. In today’s economy with one bank buying the other and other’s closing their door, how hard do you think that letter may be to get? That’s why MVD recommends title owner’s to perfect their lien because $18 today is a lot better than the hassle tomorrow (of course 7% may be a good reason to chance it).

For those asking people to “read the article” before posting. How about reading the Bill? The article misses a lot of facts as most articles in the media does. Go to: http://www.legis.state.ga.us/ and read this Bill and any other Bill you think may concern you. Folks get involved and contact your Representative. Let them know they still represent you the voter and not their own self interest.

CARY pRUITT

March 13th, 2009
10:22 am

What were they thinking? If you are out of work and need transportation the old junk for $2500 now cost you $5000. The 16 year old kid that has to buy his own car now will have to pay double for it. The $100,000 car from the dealer just went down $4500. The math doesn’t really add up to more money for the state just more money for the politicians. Remember these people were voted into office and we should vote them out. Ga Born

Tax Cheat

March 13th, 2009
10:25 am

Isn’t nice of House Majority Leader Jerry Keen (R-St. Simons Island) to accuse anyone who sold a car directly to someone else as “doing their transaction under the table”? I wonder if the 900,000 who completed these transaction realized they were tax cheats and criminals. Maybe we should round them all up and put them in jail

What scumbags these sanctimonious politicians are!

Scrapin' the bottom.

March 13th, 2009
10:31 am

Wow, Georgia is really scrapin’ the bottom of the barrell for “clever” ideas on how to get more money from the working class while once again letting the rich folks off the hook. I mean no disrespect to the people who are well off financially. That is something we all hope for. But there is something wrong when the tax system charges me $1200 property tax for my modest 2 bedroom home on a small piece of land, while Betty Boredom in her multi-million dollar country club river-front home on 280 of the most expensive acrage in a 100 mile radius, pays nothing because she makes some jam, calls it a farm, and reports a loss every year.

How is this tax any different? I drive an economy sized used vehicle because I can’t afford to buy a new one from the dealership. And now, if I could afford to buy a 28,000 automobile, I would have to pay the same amount of tax as Betty would for her 150,000 Mercades? C’mon Porter! What the hell is wrong with you. Then you openly boast about how this will generate “a whole lot of money” from average working Georgians, and benefit the rich. I just hope that by some chance that was all sarcasm, lost in translation through AJC, because you are an idiot if you think that is an accomplishment to be proud of. And JERRY KEEN… “Under the table” implies something being done illegally. Can you explain to me how you figure (prior to this vote)that individuals purchasing from individuals and not paying a sales tax goes against any laws? I’m kind of thinking that you can’t, and yet you presume to accuse 1.8 million Georgians who participate in the 900,000 person to person yearly automobile tranactions, of criminal activity. Whose pocket are you in Jerry? What kind of “under the table” deals did you make that would cause you to want to sell this ka-ka to the public. Did someone slip you an extra little bonus to say that. Well, at least I know who NOT to vote for in the next election. If it is going to be something that is fair to all, then why couldn’t you just make it a 3.5% fee and remove the $2000 cap? There are more social classes than just the working class. Why is it so important to you that the working class foots the bill for everyone?

You have to be kidding me

March 13th, 2009
10:35 am

Are you kidding? I am now paying around $150 for my tax and title, but if I buy a little $10,000 car, I will have to pay $700? And who says I want to fund a trauma center. Being white I would never be able to use it anyway. Only the indigent. Talk about stealing from the middle class for the illegals and the never worked class!

This is the worst idea I’ve heard in a long time!

Atico

March 13th, 2009
10:44 am

I have not seen the vote tally, but I am confident that my tax loving State Representative from Jackson County voted Yea for this “stick it to the poor folks” piece of dung bill. This idiot that represents the poor folks of Jacksson Couunty believes in taxation from age 21 to 101. These cross over Democrats need to be voted out of office NOW.

Tax Cheat

March 13th, 2009
10:45 am

Since he has accused 900,000 of us of being tax cheats and morally corrupt for selling our cars directly to other individuals, why not drop old Jerry Keen an email to let him know how pleased you are with his blanket condemnation of all of us criminals?

jerry.keen@house.ga.gov

Stick

March 13th, 2009
11:06 am

Have any of you read this bill? This will decrease the amount of yearly taxes paid and will be replaced with a one-time tax. This money is going to fund the Georgia Trauma System which will be used to treat everyone critically injured in motor vehicle accidents. And don’t sya “it won’t happen to me”. 700 people a year die in Georgia from trauma (injuries). When polled, the majority of Georgians stated they would pay a tax for a trauma system, well, here it is.

sr citizen dawg

March 13th, 2009
11:16 am

Oh so true, “Nobodys life or liberty is safe when the legislature is in session”…………I hope these idiots constituents remember them severely at the ballot box next election. They are so out of touch with reality they should be put where they can do no harm to anyone. Why dont you just get out of our lives and thus leave us alone ?

Chris

March 13th, 2009
11:38 am

So does this mean if I “sell” my car to my wife for $1 that I can pay $.07 tax and stop paying property tax?

Y. Jacobs

March 13th, 2009
11:53 am

Incompetent, greedy government officials hard at work with OUR tax dollars.

James

March 13th, 2009
12:09 pm

Funny how they want their money up front. Why can’t we pay in parts yearly until we’ve reached the (up to) $2k? What if my car gets totaled by an uninsured motorist tomorrow? I get double screwed on replacement of my car. The need to get all the money up front is a clue of how financially inept the gov is. They’re leveraging the prepayment of tax to make up for their shortfalls. Bookcookers….

Pat

March 13th, 2009
12:09 pm

This legislation and the redneck reaction to it fills me with total despair. Not so much the “tax relief” the Republicans in the dome passed – I expect them to F__ the public. But the ability of the average Georgian to trace and connect the dots when they hit the voting booth. Pay attention:
WHO SUPPORTED THIS IDEA? Republicans, and sellout Dems who pocketed money from car dealer/lobbyists. But Repubs run our state, and for them, fat cats win, you lose. End of story.
WHO’S OPPOSING IT AS UNFAIR TO THE LITTLE GUY? Democrats – except for the above-mentioned traitors deep in hock to the “bidness community.”
WHO BENEFITS FROM THE DEAL? Very wealthy people for whom an extra thou or two is chicken feed, and those buying very expensive new cars – and car dealers (or so they think. They’re in for a surprise.)
WHO GETS SCREWED? You and me and anyone of average income.

The light’s beginning to dawn on some folks on this board. Yet it’s amazing how many can’t connect the dots when they hit the voting booth! WAKE UP! You got F__KD by Georgia Power to pay UPFRONT for a plant they haven’t built yet because they own the Republicans. The rightwing religious nutjobs get to decide the people don’t get a vote on alcohol sales because they run the GOP! Yet who do some geniuses on this board blame? We get snarky comments on the “Messiah,” and the tax-loving “liberals.” Are you kidding me? Eight years of Bush utterly destroys our economy in the worst disaster since the Depression and now Obama gets blamed for having to spend to get us out? I’m sure the geniuses behind this bill think it’ll help new car sales. Not so fast, morons. Maybe when your sales completely tank you’ll realize you just made it impossible for average people to afford to pay the tax upfront. Did you crunch the numbers enough to be so sure all the luxury car sales will offset it?
Middle class Georgia voters, stop bending over. Release your grip from around your ankles, straighten up, and look behind you at the face of the Party that keeps SCR-ING you over! But no, come election time in our stupid red state, bubba Joe will go back in the booth baaaaahhhing like an obedient little sheep.

Kevin

March 13th, 2009
12:40 pm

I am confused, how will the revenue make its way back to the local level??

A sizable portion of the SPLOST, ELOST and LOST taxes come from the sales taxes generated off automobiles. If we do away with the sales tax, there will be a significant decrease in funding for local capital projects. Assuming there is an overall increase under the new method, how will the money be divided that goes back to the local level given the variety of sale tax initiatives and varying millage rates? Just curious.

In order to forcast and compare the new versus old method you would have to be able to forecast sales tax and anticiapte the variety of LOST, SPLOST, and ELOST initiatives. If the schools aren’t screamin than you can be assured this new method will generate more money. Looks like GA issues close to 3 million new titles each year.

As an aside, I just love how the “Change” that has come to America has done more to divide us than bring us together. I have never seen so much rich versus poor crap in my life. This is neither a rich verus poor or red versus blue issue. The desire to get money from the individual car sales has been going on long before the Republicans had a majority in Georgia.

RicS

March 13th, 2009
1:20 pm

Chill Out… It’s only passed through the House. The senate can and will change it. Then maybe the Gov. will sign it. BIG maybe!

Edward

March 13th, 2009
2:09 pm

Yep, I have an 11 year old car… was thinking about getting a new one this year, maybe even do my part to help out the economy.. but I am going to try everything to keep it going until next year.. sounds like in the long run, I will save money.. Too bad for the car industry.

Marcus Sanchez

March 13th, 2009
2:55 pm

Fellow overtaxed citizens of Georgia; we can thank another lobbyist group for this new tax. As you know or should know, many bills that passed this session were motivated by corrupt lobbying groups.

The group behind the title tax is no other than the Georgia auto dealers association. The dealer association felt the dealers were at an economic disadvantage because you and I could sell each other a car with no sales tax and the dealers had to collect sales tax on used vehicles.

The problem with the flawed justification of this bill is that dealer gets their bill passed and we the tax payer get gouged with another tax. Way to go – elected official. Thanks again for representing the people.

JJ

March 13th, 2009
3:13 pm

Let’s think about this. As it is now, if you buy a car for $10,000 & get $5,000 for your trade in, you owe tax on $5,000. Will you owe tax on $10,000 the new way?

Roy

March 13th, 2009
3:48 pm

This must be the stupidest piece of legislation ever dreamed up by a human being, or is this just more monkey business? I guess having a job under the gold dome must require a very low IQ at this time.

Buddha the Magnificent

March 13th, 2009
4:46 pm

Well, I was looking forward to losing the d@mned ad valorum tax, but the details of this “thing” are enough to make me wish those chuckleheads under the gold dome had stayed in bed with their strumpets and forgotten to do us all a favor. Thanks for nothing!

Mr.StoneMtn.

March 13th, 2009
8:17 pm

I can’t stand the mf GOP. As if the previous EIGHT YEARS OF MISTAKES weren’t enough…

arlene gaddis

March 14th, 2009
5:07 pm

all you people down there is to make things worse!!!! why don’t you do something worth while instead of trying to get more taxes one way or another….

PERCY

March 15th, 2009
2:09 pm

We have ordered a special edition Lamborghini that will arrive in Jan 2010. The price is expected to be around $400,000. Let me get this correct, so under this new bill we will only have to pay $2000? That is 0.5% with no ad valorem tax ever! Looks like Georgia will become the new Dubai. We love Georgia and Sonny too.

Deborah

March 17th, 2009
11:05 am

Well… another chance for the GOVERMENT to be FAIR & BALANCED!… Thanks for punishing those who work hard and pay for their insurance (which is too high in Georgia) and their car payments… I own a motorhome and pay an a hugh amount of taxes on it… It never leaves my driveway.. Too busy paying TAXES to get to go anywhere~!…

Goverment has got to stop TAXING us to death…! Where does this maddness end… Maybe in 2112 when a REPUBLICIAN can try to take a mop and clean up this TAX and SPENDING mess!

PERCY

March 17th, 2009
12:47 pm

Are you asleep? The backers of this bill and the majority in the legislature are Republicans. They are the same clowns that wanted to begin taxing groceries again.

But hey, I will exploit this bill to the fullest!