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Auto tax changes surprise some at county tag offices

Friday, March 1, 2013 4:51 PM
Last updated Saturday, March 2, 2013 1:33 AM
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Lafe Carter was a day late, and thus, about $200 short.

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Angela Martin (left) stands in line to renew her daughter's car tags at the south Augusta tag office.   SARA CALDWELL/STAFF
Angela Martin (left) stands in line to renew her daughter's car tags at the south Augusta tag office.

The former North Au­gusta resident had recently moved to Richmond County, bringing with him a 2005 Chrysler minivan that needed a new Georgia license plate and registration.

That’s what took Carter to the south Augusta tag office Friday.

He and a few hundred other residents had come on the first of the month to renew registrations, buy tags and register titles – things that normally take place at the beginning of every month, said Tax Commissioner Steven Kendrick.

“We always have a line on the first of the month,” he said.

Friday was no different, except for one very significant change – Georgia’s new automobile title tax went into effect. Many of those who weren’t aware of the changes, including Carter, were in for a surprise.

“I was expecting between $80 and $100 out of pocket,” said Carter, who assumed he would be paying the yearly ad valorem tax that Georgia car owners have been accustomed to doing every year. “I got hit for $300-something. It left me broke for the weekend.”

Because Carter was transferring his vehicle from South Carolina, he was subject to a one-time title tax of 6.5 percent, based on his car’s fair market value.

He didn’t have a choice. In order to receive a Georgia tag, Carter had to pay the tax on the spot.

“If I had come yesterday, I wouldn’t have to pay it,” he said.

The new law replaces the yearly ad valorem tax, or “birthday tax,” on vehicles with a one-time “title tax” when a vehicle is purchased or transferred to another party. Car purchases will be exempt from most sales tax, too. Residents still will have to pay 1 percent on the first $5,000 of the purchase price for the new transportation sales tax – a maximum of $50.

Kendrick said there are three main categories of car owners who will be affected:

• Residents who bought a car before Jan. 1, 2012, will continue to see yearly ad valorem tax bills due on their birthdays.

• Those who buy cars starting March 1 will be exempt from sales tax on the vehicle and will not pay the birthday tax. They will pay only the one-time title tax.

• Residents who purchased a car between Jan. 1, 2012, and the end of last month can “opt in” to the new title tax, or they can continue to pay the birthday tax each year.

Whether a resident should opt in depends on several factors, including the value of the car, how much tax they have already paid and how long they intend to keep the vehicle. The Georgia Department of Revenue has an online calculator at that can help residents decide what option is best.

Takiyah Douse, the tax commissioner’s Motor Vehicle Division director, said there were a few people surprised by the tax, but for the most part Friday was business as usual. By 12:30 p.m., the office had served about 450 customers. Of that number, less than 10 percent were affected by the new law, Douse said.

Kendrick, Douse and other tax officials were at the tag office to help explain the new law and ensure things ran smoothly.

Ed Pippin said he was aware of the new law when he came to get a tag for a 2012 Nissan Sentra he had recently purchased. He wasn’t expecting to opt in to the title tax because he thought he would have to pay more.

“I’m not going to because of the up-front cost,” he said.

It was explained to Pip­pin that he likely would not have to pay anything because he had already paid sales tax this year on
the purchase, which can be credited toward the title tax amount.

By opting in to the title tax, he will pay no more taxes on the Nissan as long as he owns it, just the $20 tag fee each year.

“That sounds OK to me,” he said.

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agustinian 03/02/13 - 07:51 am
Good Change

Good Georgia. Tax the vehicle once, and then let it go. I wish South Carolina would do that, or give you the option of one time sales tax when the vehicle is purchased, or ad valorem tax every year. That annual tax discourages people from buying new(er) cars.

asher 06/10/13 - 06:10 pm

We are new Georgia residents who have owned 2nd home here for years. We registered two vehicles in May when we moved here permanently (as law requires) and were charged $4,270.13 just to register 2 cars!! We paid tax already on these cars when we bought them. We should not have to pay TWICE.

One vehicle had 75,000 miles on it and the other was a Ford Explorer and had $12,000 miles. WE PAID TAX ON THE CARS WHEN WE BOUGHT THEM! If we had known this, we honestly would have kept a residence in Florida - because we are additionally going to have to pay the 10% state tax that we didn't have in Florida. We would have been better off keeping a condo there and not paying the ad velorem and added income tax! When word gets out, Georgia is going to lose those people who find it too expensive to make the move. Also, I do think this is discrimination and Florida had a tax similar to this and it was found unconstitutional and revoked & they refunded money to over 600,000 people for those that paid during 3-4 years they had the tax. Currently Florida charges an additional $100 to new residents and Tennessee charges NOTHING additional for new residents. Our daughter is taking her car and registering in Tennessee so we can avoid tax on that one!
We have been and will be adding to the GA economy and increasing state tax revenue and property tax revenue -- not happy about being bilked by the state for simply changing residency. My 86 year old mother in law was charged over $1,300 to register her 2006 vehicle. I have sent a complaint to the governor and state legislative rep about this. Sad way to welcome new residents. When word gets out, people will think twice about coming to this state!

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