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Revisions made to vehicle title ad valorem tax
by Asia Ashley
Staff Writer
Mar 12, 2013 | 2124 views | 0 0 comments | 2 2 recommendations | email to a friend | print

A revision to the Georgia vehicle title tax was passed went into effect on Wednesday.

The new changes extend the opt in date for those who purchased a vehicle after Jan. 1, 2012. The opt in deadline was originally set for December 31, 2013 and has now been extended to Feb. 28, 2014.

Those eligible to opt in to the title ad valorem tax, which allows those purchasing a car to pay a one time title fee at the time the title is being obtained instead of paying the annual “birthday tax,” are those who have purchased a vehicle after Jan. 1, 2012.

The original bill that passed before March 1 did not allow vehicles purchased from other states by Georgia residents the opportunity to opt in, which upset many people.

LaGrange resident Joe Hendricks bought his car in Valley, Ala. in Sept. 2012, but when he went to opt into the title tax, he was unable to.

“We should have the right to buy cars wherever we want,” said Hendricks. “My car is registered in Georgia, I paid Georgia sales tax on the vehicle. I should be able to opt in.”

Days after Hendricks’ complaint, the new tax law allowing residents purchasing from out of state opt into the ad valorem tax, was finally approved on March 5 and went into affect a day later.

Tax commissioner Gary Wood said that the new changes have been attempting to get passed prior to March 1, but was rejected twice.

“We didn’t think it was fair that those buying out of state couldn’t opt in, even though they were paying Georgia sales tax and were registered in Georgia,” said Wood. “We are very customer oriented and try to work with the people.”

Those leasing vehicles, now benefit from the new change. Before, those leasing vehicles after March 1 had to pay the seven percent sales tax with the possibility of the dealership including the 6.5 percent title fee into their lease. The changes now allow those leasing to not have to pay the title fee and sales tax. They will now just pay that ad valorem title fee.

Wood said that more possible change will come to the title ad valorem tax, as they are constantly reviewing the outcomes. He encouraged those who have purchased a car since Jan. 1, 2012, to opt in because it will save title owners .5 percent, by paying the 6.5 percent title fee instead of seven percent taxes that they are paying on their vehicle.

The one-time title ad valorem tax is calculated at 6.5 percent of the vehicle’s value, not the sales price, as defined by the Department of Revenue’s motor vehicle ad valorem assessment manual. When there is no value available in the manual, the higher of either the bill of sale or a reputable used car market guide will determine the value.



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