New Motor Vehicle Tax may delay car purchases -, South Georgia News, Weather, Sports

New Motor Vehicle Tax may delay car purchases


Some area car dealers say confusion over a new motor vehicle tax is keeping some customers from buying, but they say it shouldn't hold you back.

County commissioners were informed of the changes Monday at their meeting. Starting March 1st, the new Motor Vehicle Tax Reform will change the way we pay taxes on a new vehicle.

People who are out shopping for cars may not actually purchase one until March in hopes of saving some money in the long run on taxes.

Before you purchase that vehicle you have your eye on, there are some changes you should be aware of.

"Major change in the way we do motor vehicles in the state, and a totally different process, a lot of confusion, a lot of misunderstanding," says Denver Hooten, Tax Director.

The Motor Vehicle Tax Reform Law, which becomes effective March 1, will basically do away with the dreaded birthday tax and instead require a one-time tax when you get the title.

"Any vehicle that is titled after March 1st, this will be affecting that, there will be a 6.5% title ad valorem tax fee due at that time," says Hooten.

Which could surprise many customers at the title desk but it is mostly good news to car shoppers.

"I am looking at buying two cars now, so that would be great to know that I won't be paying that every year on my birthday," says Robert Bruce, Carl Gregory Hyundai Sales Person.

Car shoppers who buy from dealerships might not notice the difference at first since the new tax essentially replaces the sales tax on a car purchase.

"It is very possible and more likely that if you pay this one time fee, it will be less than what you would pay if you are going to keep the car a few years," says Hooten.

Which is why some dealerships say some customers are holding off on buying a new car for a few months.

"I have a customer right now who is waiting off until March 1st, retired marine, that has looked into it and that is the 1st thing he said when he came out was, 'I am really thinking about the Hyundai product but with this tax thing I am going to wait until March 1st'," says Bruce.

But there's really no need to wait. If you purchased a vehicle in Georgia between January first of 2012 to March first of this year, you have the option to opt in and pay this one-time fee.

The biggest shock may come for people who buy a vehicle from an individual. If you do that, you will now have to pay 6.5% of what the car is worth when you register the title in you name.

If you don't plan to buy a car, you'll continue to pay the annual ad valorem tax on your current vehicle.

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