Sticker Shock: ‘Unprecedented’ rise in vehicle values means higher tax bills | Headlines

The latest increase in the price of employed motor vehicles seems possible to guide to an abnormal increase in most personalized assets tax charges for Prince William County people, a levy that historically shrinks above time.

A pc chip scarcity brought on by the COVID-19 pandemic has designed new cars tougher to arrive by, driving up assessments on utilized kinds.

“Right now, if you have a employed automobile, you can market it and likely make extra than you acquired it for,” Michelle Attreed, Prince William’s finance director, instructed the Board of County Supervisors final month.

In Virginia, which levies a particular home tax on automobiles, this could imply a better tax monthly bill in the fiscal yr 2023, which starts off July 1. Ordinarily, personal assets tax expenditures minimize more than time because as a car will get more mature its assessed price drops.

Nevertheless, Prince William County officers are projecting evaluation increases for practically all of the around 161,000 cars registered domestically and designed because 2007. Because of that, tax charges will increase devoid of a reduction in the private assets tax level, which is $3.70 for every $100 of assessed price. That implies the proprietor of a car or truck assessed at $10,000 owes $370 in private residence taxes. 

car value graphic

Attreed reported that the growing auto assessments are “unprecedented.” 

The the greater part of the neighborhood vehicles, 88,998, will see their benefit expand among $501 and $2,500, main to an boost in expenditures of $19 to $93.

The 2nd most-prevalent projection is an improve among $2,501 and $5,000 for 45,722 autos. People motor vehicles will see their charges increase involving $93 and $185.

Only 11,864 autos had an maximize in benefit less than $500, main to up to $19 tacked on to their tax bill.

The other 3 brackets of assessment improves county employees believed are: 

  • 13,995 automobiles growing between $5,001 and $10,000, with a tax monthly bill boost of $185 to $370

  • 738 vehicles increasing $10,001 to $15,000, with a tax invoice enhance of $370 to $555

  • 126 autos raising in between $15,001 and $20,000, with a tax invoice raise of $555 to $740

In accordance to the U.S. Bureau of Labor Statistics, the regular value of utilized vehicles and vans rose 40.5% from January 2021 to January 2022.

In Prince William, each individual automobile from design yr 2007 to 2020 on typical grew in worth by more than 20%, with 2018 styles growing additional than 40%. The 2021 design yr grew an common of about 15%.

Each and every truck design 12 months from 2007 to 2021 greater by additional than 15%, with 2018 mounting a lot more than 30%. 

Large vehicles manufactured from 2007 to 2020 also improved in value by extra than 20%, peaking at extra than 45% for the 2015 design calendar year. The 2021 major vans grew in worth about 5%.

The county projects that the own house tax levy will make $168 million in total earnings toward the fiscal 2023 spending plan.

The amplified assessments arrive as county inhabitants deal with skyrocketing inflation, soaring gasoline rates and a possible enhance in their household serious estate tax costs.

The county’s proposed spending plan for fiscal 2023 proposes a minimize in the residential real estate tax rate from $1.115 for every $100 of assessed benefit to $1.05. Although the level is dropping, having said that, growing house values will end result in an powerful tax boost. The normal residential tax bill would enhance $233, or 4.9%, on a property valued at $466,739.

The county also strategies to undertake a new 4% tax on prepared meals, these kinds of as people served at restaurants, which would crank out $24.5 million. Of that, $14 million would go to the faculty division and $10.5 million to the county’s general fund.

Attreed claimed county personnel options to current proposals to the Board of Supervisors later this month to probably mitigate the affect of the auto assessments. 

“We think this is a momentary blip,” Attreed claimed. “It’s one thing that every person in Virginia is wrestling with and everyone in the nation is wrestling with.”