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Title tax fix not completed

ATLANTA — Lawmakers couldn’t come to an agreement on changes to the state’s new vehicle title tax, during a debate the day the law went into effect.

Senators passed a measure Friday to make several changes to the law passed last year, specifically working to right a provision that had led to double taxation on people who lease vehicles. The bill also makes changes in regard to rental cars and with buy-here, pay-here locations.

“If we don’t pass this bill the leasing industry is shut down,” said Sen. Don Balfour, R-Snellville, as he introduced the bill. “We’ve got to move forward to get something fixed.”

Because the Senate moved a different version of the bill than the House, lawmakers paused to try to get agreement on the version on March 1, so car dealers could continue to do business. But the state House adjourned without acting on the measure, meaning a final resolution will have to wait until Monday at the earliest.

“I don’t think we have a choice because we can’t shut the state down and we can’t shut business down,” Sen. Steve Thompson, D-Marietta, said of voting yes despite objections to the buy-here, pay-here provisions. “We’re in a position where we better pass it.”

According to the title tax law passed last year, people will pay a 6.5 percent title tax when they purchase new or used vehicles. The rate increases over the next two years to 7 percent in 2015.

Becoming effective March 1, the title tax replaces sales taxes charged at dealerships as well as annual ad valorem taxes, although people will continue to pay the so-called “birthday tax” until they no longer own a car under that system.

Comments

Don_Coyote 1 year, 9 months ago

The Georgia Automobile Dealers Association got the exact legislation they paid good money for last year. Let them live with it.

The most reprehensible action with Sen. Balfour's proposed changes is that the "Buy Here, Pay Here", used car dealers would only pay a 4.5 percent rate on the title tax while individuals would still be required to pay 6.5 percent. These guys really have no shame.

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R 1 year, 9 months ago

Next up: Mandatory waffle purchases with each car tag, at least that would leave us GREEN...

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Mack711 1 year, 9 months ago

The powers to be have not thought out this to the satisfaction of the Georgia Automotive Dealers Association, or for the citizens for that matter.They will be coming back within a couple of years when they find out that this idea was a mistake and that the State has lost money on this deal. Now most will be repairing their cars instead of buying new or used ones, therefore the dealers will not be selling as many cars as they want to. Some may close before this idea is scrapped. Should have left well enough alone.

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Why_not 1 year, 9 months ago

It seems to me that not having to pay the 6% sales tax initially and only paying 1/2% more for the title tax and NEVER having to pay the inflated ad valorem tax annually would be a good deal any way you look at it. I wish I could opt-in with all my current vehicles.

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Don_Coyote 1 year, 9 months ago

I suppose you are happy paying the 6.5 % rate as an individual while the high risk used car dealers pay 4.5% too?

I buy used cars from individuals so that someone else takes the hit for the initial depreciation. I usually get better deals by meeting the original owners which gives me an idea of how the car has been cared for and I'm not paying for dealer overhead and commissions. I was fine paying an ad valorem annually in lieu of paying the state 6.5% of what essentially they think the car is worth.

Also there is the matter of the counties getting shorted out of any SPLOST money on the dealer sales and that shortage will eventually come out of property taxes. This was bad legislation that was not thought out well as evidenced by the need to patch it, even this attempt the same day it goes into effect.

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R 1 year, 9 months ago

The real question on my mind is how does a "private party" become listed as a "Buy here, Pay here" that qualifies for the lower rate?

After all, you will buy here and pay here in any private transaction ...

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kevin 1 year, 9 months ago

Can you believe this messy tax bill? It just started to be enforced and there are holes to be fixed in it. No one seems to be able to write a correct bill, not even now and then. What a disgrace for the "gold dome."

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