Hicks Issues Reminder About Motor Vehicle Tax Changes

February 19, 2013

Changes are on the way in the next couple of weeks that pertain to motor vehicle taxes and fees.

Starting on March 1, the purchases of motor vehicles beginning on that date will be exempt from both state and local sales tax and the ad valorem tax, also known as the “birthday tax.”

Stephens County Tax Commissioner Dene Hicks said that in its place, the new one-time Title Ad Valorem Tax, or TAVT, will apply to self-propelled motor vehicles purchased after March 1, like cars, trucks, and motorcycles.

“If you purchase a vehicle after March 1, 2013 that does qualify as self-propelled requiring a title, then you will be required to pay the Title Ad Valorem Tax, which is the TAVT, which is 6.5 percent during 2013, and you will pay that amount when you come in to change the title.”

That TAVT will be 6.5 percent based on the value of vehicle, as determined by the state’s Department of Revenue.

Hicks noted that even under the new system, individuals will still pay a tag fee yearly during the month of their birthday.

She also said that nothing would change for vehicles purchased prior to January 1, 2012, nor will the new rules apply to items like pull-behind campers and utility trailers. All of that will still fall under the old tax system.

As for vehicles purchased between January 1, 2012, and February 28, 2013 in the state of Georgia only, Hicks said those individuals have the choice to opt in to the new system or continue under the current ad valorem tax structure.

“They will get credit for any sales tax that they paid, so they will need to produce a detailed bill of sale from the dealer where they paid the sales tax and then 6.5 percent will apply on the value of the vehicle and they will get a credit for any Georgia sales tax that they paid and they will also get credit for any ad valorem tax paid during 2012 and 2013 for January and February birthdays,” said Hicks.

Hicks said that the Tax Commissioner’s Office will provide people with the choice to opt in with the numbers comparing opting in to the new system rather than staying under the current structure.

According to Hicks, letters will go out to those who may opt in. Those with the choice will have until December 31 to opt in to the new system, regardless of when in 2013 their birthday falls.

As for the new tax, Hicks said those who purchase from dealers should not notice much of a difference because instead of 7 percent in sales tax, they will now pay the new TAVT, which is 6.5 percent this year.

However, Hicks said someone purchasing from a private individual after March 1 will notice a big difference.

“It is the casual sale people that come in that are used to buying that car from their neighbor and get a good deal and they come in and we charge them $18 for the title and $20 for their tag, $38 and they are out the door,” said Hicks. “(Now) when they walk in with that $10,000 vehicle, we charge them 6.5 percent on top of that.”

Hicks said her office is getting ready for the new rules to take effect and will post a video on the new law on her office’s website, www.stephenscountytax.com. She urged people to watch the video online.

Also, those with questions can call the Tax Commissioner’s Office at 706-886-4753.

 

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