Is the Georgia ad valorem taxes on cars (for new residents) unconstitutional? (sale, student loans)

[midgeorgiaman]

For the record, I had a family member recently move here with a 2002 Tacoma with 135000 miles on it. The cost to title and tag it was $738. "Welcome to Georgia. We are so glad you are here (with their hands out)!"

That is a ridiculous amount of money for a 12 year old vehicle. God help the family with 2 newer vehicles and maybe a third or fourth for teenagers. That could run into the 2 or 3000 dollar mark quickly. Uncostitutional, no, but smart...not so much. I have to question the wisdom of a policy that fleeces new residents with such a burden if they choose to move to our state.

If a family was choosing between 2 moves, that kind of money could have some impact on the decision.

[sivram]

I just recently moved to Georgia. In total shock after paid 7% Ad Valorem Tax towards title for my vehicle bought last year in different state. We move around different states due to our job and I feel it is highly unfair applying this tax without any exemptions or logic to all the peoples. Any why someone would expect people like us to stay in Georgia for long time. Seriously feeling very bad for moving this state.

[OneDawg]

Oh heck I've been paying those taxes for years. I recently returned from a stint in Larghetto, Fla and where I had bought a newer truck. When I found out that the new tax was only 6.5% - I traded my vehicle to another family member and didn't have to pay any advalorem.

[annaneal]

I agree with Brian_M -- for those of us who moved here and just paid sales tax (almost $4k in June of last year) only to move here and be told we have to pay taxes AGAIN! I mean seriously! I have to say I am pretty hacked off and I definitely feel like I am being robbed! I have no idea where I am supposed to come up with this money. I saved for a long time to come up with the down payment and taxes before I bought this car last year in June. So, how is it okay for a state to essentially cause new residents to be double-charged for their vehicles?!?! Clearly this was either unintentional and needs to be fixed OR it was on purpose and someone is trying to make a killing on all the people moving here. It will backfire though if word gets out which I personally intend to make sure it does!!! I was excited about moving here. Now I feel like I've arrived in some foreign country where they see the tourist coming from a mile away and start planning how they will fleece them!!! So angry!!!!

[cwkimbro]

Originally Posted by annaneal

I agree with Brian_M -- for those of us who moved here and just paid sales tax (almost $4k in June of last year) only to move here and be told we have to pay taxes AGAIN! I mean seriously! I have to say I am pretty hacked off and I definitely feel like I am being robbed! I have no idea where I am supposed to come up with this money. I saved for a long time to come up with the down payment and taxes before I bought this car last year in June. So, how is it okay for a state to essentially cause new residents to be double-charged for their vehicles?!?! Clearly this was either unintentional and needs to be fixed OR it was on purpose and someone is trying to make a killing on all the people moving here. It will backfire though if word gets out which I personally intend to make sure it does!!! I was excited about moving here. Now I feel like I've arrived in some foreign country where they see the tourist coming from a mile away and start planning how they will fleece them!!! So angry!!!!

You're not exactly being double charged.

This is a replacement of the annual ad valorem tax, so if this change didn't happen you'd be paying an annual tax in its place. Granted it would be easier to stomach, but it can be beneficial in the long-run too.

After 3-5 years in most cases the up front tax will pay for itself.

So before you get too hacked off, take this into account.

The real losers seem to be whoever moves in and moves out soon after.

And if you had known about this ahead of time and could have delayed your car purchase, you would have actually saved/benefited from this new tax policy overall. Some new comers catch wind of this and end up better for it, some don't. It varies from individual to individual.

[Atlmike]

Its def designed to benefit the car dealerships in GA .. go figure. However i agree with the above when i lived in SC for exmaple .. if you had a newer 2010- car you'd pay tax every year. So if you paid 400$ for tax and tag thats what you would continue to pay year after year until the car gets old say 5 years or more. They would do adjustments for mileage but it wasnt really that much of reduction maybe 30$ .

I paid 300$ when i moved here and at least its over with upfront instead of doing it year after year.

[aus10]

We own property in two states, GA and FL. We split our time between the two. We had considered making GA our permanent home, however, this is confusing me. If we do this, will we have to pay this tax on all our vehicles, including our 42' motor home? We paid sales tax on these vehicles already which was a chunk. If I read this correctly even though we've already paid sales tax in 07, 11, and 13 when these were purchased we have to pay again?

[cwkimbro]

Originally Posted by aus10

We own property in two states, GA and FL. We split our time between the two. We had considered making GA our permanent home, however, this is confusing me. If we do this, will we have to pay this tax on all our vehicles, including our 42' motor home? We paid sales tax on these vehicles already which was a chunk. If I read this correctly even though we've already paid sales tax in 07, 11, and 13 when these were purchased we have to pay again?

Yes and no.

There are some big pros and cons to this depending on the situation.

What they did was they got rid of 2 taxes: a) The annual ad valorem tax and b) the sales tax.

They replaced it with a single one-time tax very similar to the value of a sales tax of the fair market value when you register the vehicle (ie. older car... cheaper tax, so it definitely won't be as much as when you bought the car/motor home). That tax will be 7% of the market value of the vehicle when you pay the tax, not what you paid for it in the past.

So on a yearly basis you only pay a $20 tag fee. There is no annual property or use tax on the vehicle anymore.

So for you personally in your situation. You need to calculate how much in annual taxes you pay in Florida on these vehicles and consider how long you plan to keep them. Then calculate what your Georgia tax would be 7% of the current market value. If you move here half is due at registration and the other half is due within a year.

If you plan on keeping the vehicles a long time, you can end up ahead. If you plan on getting a new car soon, it is better to sell in Florida and buy the next car after arriving in Georgia (that will save you Florida sales tax and 1 year Florida property tax on the vehicle). I don't know much about Florida tax policy to tell you, but it is different for everyone based on their vehicle, long-term plans, and where they are from now.

[aus10]

Originally Posted by cwkimbro

Yes and no.

There are some big pros and cons to this depending on the situation.

What they did was they got rid of 2 taxes: a) The annual ad valorem tax and b) the sales tax.

They replaced it with a single one-time tax very similar to the value of a sales tax of the fair market value when you register the vehicle (ie. older car... cheaper tax, so it definitely won't be as much as when you bought the car/motor home). That tax will be 7% of the market value of the vehicle when you pay the tax, not what you paid for it in the past.

So on a yearly basis you only pay a $20 tag fee. There is no annual property or use tax on the vehicle anymore.

So for you personally in your situation. You need to calculate how much in annual taxes you pay in Florida on these vehicles and consider how long you plan to keep them. Then calculate what your Georgia tax would be 7% of the current market value. If you move here half is due at registration and the other half is due within a year.

If you plan on keeping the vehicles a long time, you can end up ahead. If you plan on getting a new car soon, it is better to sell in Florida and buy the next car after arriving in Georgia (that will save you Florida sales tax and 1 year Florida property tax on the vehicle). I don't know much about Florida tax policy to tell you, but it is different for everyone based on their vehicle, long-term plans, and where they are from now.

Thank you! We pay one time sales tax at time of purchase of 6%. It is 225.00 registration one time fee, then 79.00 a year for the license plate for each car. The motorhome is right at 100.00 per year. We don't pay an annual tax on them. No way am I going to get hit with 7% tax again, especially on the behemoth RV. We'll just stay FL residents... That negates any gains, and then some, with Georgia's lower insurance rates and being able to claim a homestead exemption on this house. I'll just continue to pay non-resident property tax in GA and higher insurance in FL. Thanks again! I just calculated what it would cost me... I just about had a coronary! I'd need to take out a small mortgage!

[midgeorgiaman]

Originally Posted by aus10

Thank you! We pay one time sales tax at time of purchase of 6%. It is 225.00 registration one time fee, then 79.00 a year for the license plate for each car. The motorhome is right at 100.00 per year. We don't pay an annual tax on them. No way am I going to get hit with 7% tax again, especially on the behemoth RV. We'll just stay FL residents... That negates any gains, and then some, with Georgia's lower insurance rates and being able to claim a homestead exemption on this house. I'll just continue to pay non-resident property tax in GA and higher insurance in FL. Thanks again! I just calculated what it would cost me... I just about had a coronary! I'd need to take out a small mortgage!

This! This is the unintended consequence of this law. If a family has a choice of whether to move their residency here or not, this law is expensive enough to have a real impact. This is what happens when legislators cave to the auto dealer lobby without thinking of the real consequences. Our legislators putting business interests above all else....what a shocker.

While it may be a better longterm deal for current residents...those who move here get shafted....badly. While the new law is better for almost everyone longterm, they forget that most Americans cant cough up thousands in cash at the drop of a hat.