Filed under: Government/Legal, Supercars
Class warfare: Exotic car owners in MA got massive tax break
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Owning a high-end car? Fun. Paying the hefty vehicle tax on it? Not so much -- that is, unless you live in the state of Massachusetts. From the late 1990s to 2007, the state's Registry of Motor Vehicles missed collecting $32 million a year in annual taxes because it used the NADA database to calculate them for some 131,000 exotics or otherwise premium vehicles. Unfortunately for the RMV, NADA's database excludes high-end luxury vehicles, so there was no proper way to tax those cars in the state. If, for instance, you purchased a Bugatti Veyron, instead of paying many thousands of dollars, you could have wound up paying no more than the owner of a Ford Focus.
This is going to suck for owners of affected cars, as the taxman comes to collect what he missed the first time around, right? Wrong. Folks who purchased an affected vehicle through 2007 are completely off the hook. The commonwealth has decided that trying to collect the over $300 million it missed over all those years would be an administrative and legal nightmare. That's a win-win situation for premium car owners in Mass. that's sure to torque off the regular guy, whom the government had no trouble finding and collecting from, as usual. What's scandalous is that no one at the RMV figured this out until now. Bay Staters, that's you're local government (and those tax dollars it collects) at work.
[Source: Kicking Tires]
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Reader Comments (Page 1 of 3)
paul34 3:43PM (7/12/2008)
You are acting as if they got a huge break. They did, but it was the government's fault, not theirs. If they came back and collected "back taxes" that would have been very unfair IMO.
It is sort of like buying a 1960's Chevy today, then getting your car impounded and crushed in California because it doesn't meet emissions or safety standards of today.
Government's mistake - big whoops. Deal with it; if they had more money, they'd just "lose" more money anyway.
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Geeky1 3:43PM (7/12/2008)
I have little doubt that all kinds of people are going to be shocked, appalled, and hugely unhappy about this. What I wonder about is how many of them would be equally unhappy if it was the other way around...
Proof that class warfare is still alive and thriving, I suppose.
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FSM 5:38PM (7/12/2008)
Class warfare will always exist as long as there are still haves and have-nots. The poor will always be envious of the rich and the rich will always be disdainful of the poor.
Johnny 3:58PM (7/12/2008)
Is today IRS day? this is the 3rd article about taxes and cars.
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Sorin 12:16PM (7/13/2008)
Hahahahaha. Man you’re cool. I have a very bad day today, but u make my day. Thank you. :))))))))))))
Yar 4:00PM (7/12/2008)
Cant wait for hippies to pour in here declaring that this is all a big conspiracy by Big Oil to launder money for a space-based laser to destroy wildlife preservations and electric car plants.
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BowserUSC 4:59PM (7/12/2008)
Sounds like your the real paranoid schizophrenic.
Torrent 4:01PM (7/12/2008)
Why would they make people pay for their mistake, even if it is the law?
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Victor 8:03PM (7/13/2008)
Because I think the assumption is that if it was the other way around (economy car owners in MA get an erroneous tax break) the IRS would have chased down their money like rabid dogs? Granted, the money lost in this hypothetical situation may be more since there are obviously countless more economy cars.
Disgruntled Goat 7:40PM (7/12/2008)
So if the bank accidentally sends you a statement saying you have $3 million in the bank when you actually have $3000, can they ask for their money back? Ummm, yea, they can and will. Legally and ethically they owe the money, that's why they should pay, period.
On a slightly different angle, if the gov't doesn't think $300 million is worth messing with they can simply sign the debt over for collection by me. I'll even give them 10% of what I collect. It's win-win for everyone.
Ian 10:33PM (7/12/2008)
Actually, in Pennsylvania at least, theres a law stating that if the bank makes an error in your favor, they are out of luck and you get to keep the money. If they make an error in THEIR favor, they have to pay you the money back.
tankd0g 4:11PM (7/12/2008)
Around these parts the only tax you pay is on the purchase price. Which would be quite hefty at 13% of $2 million. How does it work there?
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Jared 10:23PM (7/12/2008)
In MA you pay sales tax on the purchase price. In addition, every year that you own a car (or boat), you have to pay excise tax to the town it is registered in. The excise tax is based on the worth of the car.
tankd0g 11:33PM (7/12/2008)
Wow that sucks.
GT 2:18AM (7/13/2008)
Wow, I'm starting to believe that some Americans pay more for taxes than us Canucks... I mean a tax for the privilege of just owning a car/boat? WTF or did I get it wrong?
John 6:36AM (7/13/2008)
I think we Canucks have it worse.
This article is about taxes in one US state for cars and boats. In Canada we pay higher taxes at the gas pump for every non-farm vehicle that runs on gas.
Even the gas in my lawnmower and generator is taxed, supposedly to improve highways.
PM 4:08PM (7/13/2008)
John, what do you mean by non-farm vehicle? Does that include trucks and the like that are used on the farm?
Farm vehicles only being tractors that are not street legal? And as far as gasoline in lawnmowers being taxed...you are still filling at the pump and throwing that gas in a jerry can so you are still getting obviously screwed by the government...as we are here.
tankd0g 10:51PM (7/13/2008)
In Canada at least, diesel for off road use is not road taxed. So farmers have big tanks that oil trucks come fill and they use that for their tractors and "farm only" trucks. Every farmer I see drives a dually diesel on the road. I probably would too.
matty, uk 4:37PM (7/12/2008)
Who cares?
Why should more expensive cars pay more tax?
dont exotic car owners generally drive significantly fewer miles in them than other cars, causing less congestion, less wear on road surfaces and all that.
Here in uk a big thing recently has been about car tax changes, larger cars (SUV's ect...) end up paying the equvillent of 1000 dollars a year for the right to drive on public roads but very small cars (eg under 100g/km emmisions (and hybrids maybe?? not sure)) dont have to pay any.
Stupid in my opinion, all cars use the roads.
I think car tax should be abolished and the income deficite should come from proportional increases in fuel duty. May sound insane at a time of 9 dollars per gallon fuel here today but it is fairer and will encourage less unnessesarry usage of cars unlike car tax which is just a yearly kick in the balls.
Does anyone agree or dissagree with me??
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Cameron 4:52PM (7/12/2008)
You make a good point in your first paragraph. Most of these cars don't see the light of day more than once a month, because most are only insured for a few days of driving a month.