It was only four years ago that residents of many cities and towns became painfully aware – when their auto tax bill arrived – of the real meaning of action at the state level to eliminate the $6,000 statewide excise tax exemption.
With cities and towns able to lower the exemption to as little as $500, owners of vehicles once untaxed began receiving tax bills, while others were being taxed on a vehicle that was suddenly as much as $5,500 more than in the previous year. Further complicating matters, vehicles were being assessed at their “clean retail” value rather than on what they were actually worth, increasing many tax bills.
Four years may have passed, but Sen. William A. Walaska (D-Dist. 30, Warwick) is still trying to ease the extra tax burden on residents in his community and around the state.
“Just because auto owners have gotten used to a higher bill during the past few years does not make things right. With the elimination of the excise tax exemption at the state level, some communities saw an open door to grabbing more money from their residents. Instead of gouging their residents, they should have been looking for ways to make the hike as painless as Walaska has introduced legislation offering one method to ease the tax burden – assess vehicles based on the average trade-in price, rather than clean retail value.
“There are vehicles on the road that, because of their age and condition and mileage, would sell for a lot less than the clean retail value listed in some ‘authoritative’ book somewhere,” said Walaska. “The value of that car, and the tax imposed on it, should be based on what it is really worth, not what some publication thinks it is worth in mint condition.”
The Walaska legislation, 2014-S 2203, would allow for an appeal process on municipal excise tax valuations that permits the auto owner to present to the tax assessor a certified appraisal from a licensed motor vehicle dealer of the actual value of the car. The bill would also allow 45 days for vehicle owners to file an appeal of a tax bill, compared to the 30 provided in current law.
“State residents pay a lot of taxes, and this is just one extra burden that’s been added on over the last few years,” said Walaska. “I think amending the assessment method will ease the expense for many people. I don’t think Rhode Islanders mind paying taxes, if they are fair. My legislation is all about making this tax fair.”
The bill is before the Senate Committee on Finance.