Sales Tax for car purchase is a Rip Off

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I recall reading that the state of Oklahoma waives the state sales tax on the purchase of a vehicle, and instead, charges a lesser excise tax, around 3% IIRC.
 
Originally Posted By: mechanicx
Originally Posted By: John_K

I feel the same way about license plates...I should get a refund on what I didn't use when I get rid of a car.

John


You can transfer your plates and registration and any remaining months it has to another car. That's not exactly a refund though and I think they charge a small fee for the transfer.

I hate how if you buy a car and registration a few months from your birthday they charge almost the full yearly rate for as little as 7 months of use.


mostly true. Friend of mine in Columbus, few yrs back was in desperate need of wheels, bought a REALLY poopy frankentruck s10 for $500. maybe 4 months later the engine blew (i think his dad said it threw a piston or some such(it was 8 yrs ago..) when he got his next poop-tastic car (I think adam sandler wrote a song about it...) the BMV wouldnt let him transfer the plates,b/c they had been on a truck.
same plate stock - 3 letters 4 numbers- nothing on the plate to indicate "truck" or "non-comm". So he had to shell out another $70 for another set of new plates, simply b/c they had been on a truck.
 
Originally Posted By: Hokiefyd
Originally Posted By: Colt
A vehicle can be sold 4,5....times and sales tax paid every time.


Yes and no; this depends on the state. In North Carolina, you only pay sales tax on the transaction amount. So say you buy a $20,000 car and trade in a $15,000 one. You only pay sales tax on the difference, which is $5,000.


Same here in Jersey but the next buyer of your trade will pay sales tax and if he sells or trades...
 
I don't understand the complaint. Just like those who need a new iPhone every time a new one comes out (and then pay tax on the full amount each time,) those who need a new car every few years should pay for it. If you're upset about the tax, then why not the massive amount of depreciated value you've thrown away? The cost of insurance is also higher on a newer car, as is vehicle property tax, if your state has it (I paid over $500 last year in property tax on my car!) If you're complaining about tax on all of the new cars you're purchasing, then you need to reevaluate your need for one.

When I first got out of college, I went threw a few new cars pretty quickly. I was "big ballin'" and could afford it. Here in CT I paid tax on the difference, but that in no way justified the purchase as making good financial sense, because buying cars rarely are. It was fun, and that's all the justification a newly graduated twenty-something needs.

Even though my latest car was just around $30k, where something used and reliable, and much cheaper would have sufficed, I love it and plan to keep it for as long as I can. I'm older now, though, and the need for the latest and greatest is slowly waning. I'll be happy to keep this car until it's run into the ground, even if that means replacing the motor some time.

Finally, for those who want to maintain a car in warranty, don't want to or can't afford to be stranded or left immobile, I can understand your argument, but the costs that go along with always owning new cars are many and are usually higher than that of used cars, so worrying about paying tax is silly.
 
Originally Posted By: earlyre
Originally Posted By: mechanicx
Originally Posted By: John_K

I feel the same way about license plates...I should get a refund on what I didn't use when I get rid of a car.

John


You can transfer your plates and registration and any remaining months it has to another car. That's not exactly a refund though and I think they charge a small fee for the transfer.

I hate how if you buy a car and registration a few months from your birthday they charge almost the full yearly rate for as little as 7 months of use.


mostly true. Friend of mine in Columbus, few yrs back was in desperate need of wheels, bought a REALLY poopy frankentruck s10 for $500. maybe 4 months later the engine blew (i think his dad said it threw a piston or some such(it was 8 yrs ago..) when he got his next poop-tastic car (I think adam sandler wrote a song about it...) the BMV wouldnt let him transfer the plates,b/c they had been on a truck.
same plate stock - 3 letters 4 numbers- nothing on the plate to indicate "truck" or "non-comm". So he had to shell out another $70 for another set of new plates, simply b/c they had been on a truck.



They either changed the law or he went to the wrong BMV. I bought a new Ranger and traded it 18 months later for a new Explorer. They transferred the non-commercial plates onto the Explorer and then on my birthday, I then got new non-com plates for the Explorer.
 
Originally Posted By: gathermewool
I don't understand the complaint. Just like those who need a new iPhone every time a new one comes out (and then pay tax on the full amount each time,) those who need a new car every few years should pay for it. If you're upset about the tax, then why not the massive amount of depreciated value you've thrown away? The cost of insurance is also higher on a newer car, as is vehicle property tax, if your state has it (I paid over $500 last year in property tax on my car!) If you're complaining about tax on all of the new cars you're purchasing, then you need to reevaluate your need for one.

When I first got out of college, I went threw a few new cars pretty quickly. I was "big ballin'" and could afford it. Here in CT I paid tax on the difference, but that in no way justified the purchase as making good financial sense, because buying cars rarely are. It was fun, and that's all the justification a newly graduated twenty-something needs.

Even though my latest car was just around $30k, where something used and reliable, and much cheaper would have sufficed, I love it and plan to keep it for as long as I can. I'm older now, though, and the need for the latest and greatest is slowly waning. I'll be happy to keep this car until it's run into the ground, even if that means replacing the motor some time.

Finally, for those who want to maintain a car in warranty, don't want to or can't afford to be stranded or left immobile, I can understand your argument, but the costs that go along with always owning new cars are many and are usually higher than that of used cars, so worrying about paying tax is silly.



Good post!!

Really the root of the problem is that we have a corrupt system. Two sides that are bought and completly paid for that cost the people a ton of extra money. I was hoping for the tea party till they took a hard right turn. I just want the lower taxes, less corruption part.
 
Originally Posted By: gathermewool
I don't understand the complaint. Just like those who need a new iPhone every time a new one comes out (and then pay tax on the full amount each time,) those who need a new car every few years should pay for it. If you're upset about the tax, then why not the massive amount of depreciated value you've thrown away? The cost of insurance is also higher on a newer car, as is vehicle property tax, if your state has it (I paid over $500 last year in property tax on my car!) If you're complaining about tax on all of the new cars you're purchasing, then you need to reevaluate your need for one.

When I first got out of college, I went threw a few new cars pretty quickly. I was "big ballin'" and could afford it. Here in CT I paid tax on the difference, but that in no way justified the purchase as making good financial sense, because buying cars rarely are. It was fun, and that's all the justification a newly graduated twenty-something needs.

Even though my latest car was just around $30k, where something used and reliable, and much cheaper would have sufficed, I love it and plan to keep it for as long as I can. I'm older now, though, and the need for the latest and greatest is slowly waning. I'll be happy to keep this car until it's run into the ground, even if that means replacing the motor some time.

Finally, for those who want to maintain a car in warranty, don't want to or can't afford to be stranded or left immobile, I can understand your argument, but the costs that go along with always owning new cars are many and are usually higher than that of used cars, so worrying about paying tax is silly.



My minor complaint is a vehicle can be bought and sold 10 times and sales tax will be paid on every purchase.
Not a real big deal but a lot of money goes to the state when the car is sold multiple times.
 
Originally Posted By: Colt
Originally Posted By: gathermewool
I don't understand the complaint. Just like those who need a new iPhone every time a new one comes out (and then pay tax on the full amount each time,) those who need a new car every few years should pay for it. If you're upset about the tax, then why not the massive amount of depreciated value you've thrown away? The cost of insurance is also higher on a newer car, as is vehicle property tax, if your state has it (I paid over $500 last year in property tax on my car!) If you're complaining about tax on all of the new cars you're purchasing, then you need to reevaluate your need for one.

When I first got out of college, I went threw a few new cars pretty quickly. I was "big ballin'" and could afford it. Here in CT I paid tax on the difference, but that in no way justified the purchase as making good financial sense, because buying cars rarely are. It was fun, and that's all the justification a newly graduated twenty-something needs.

Even though my latest car was just around $30k, where something used and reliable, and much cheaper would have sufficed, I love it and plan to keep it for as long as I can. I'm older now, though, and the need for the latest and greatest is slowly waning. I'll be happy to keep this car until it's run into the ground, even if that means replacing the motor some time.

Finally, for those who want to maintain a car in warranty, don't want to or can't afford to be stranded or left immobile, I can understand your argument, but the costs that go along with always owning new cars are many and are usually higher than that of used cars, so worrying about paying tax is silly.



My minor complaint is a vehicle can be bought and sold 10 times and sales tax will be paid on every purchase.
Not a real big deal but a lot of money goes to the state when the car is sold multiple times.


I'll agree with that. However, how many of us are there who buy new or newer and keep our cars forever? My last car was owned by the first owner for 150kmi, sold to their mechanic, who owned it for another 25k, and then sold to me. I drove it for 50k, then gifted it to my sister, who didn't have to pay any tax on it, since it was so old and worth very little. At least I think she didn't have to pay tax...

We're more consumer than producer these days, and we pay for it. I have plenty of savings and a good 401k, but a good portion of the remainder goes toward having fun. I'd own a house right now if it weren't for my fast car, gaming computer, laptop, tablet, blackberry, awesome speakers, Wii, 3DS, and the list goes on! Paying month for rent in a place that's close to the beach makes it tough, too, but that's besides the point. The above-mentioned are what makes me happy, and to maintain my lifestyle I give up certain other things, and make compromises where I can.

I got my base-model Subie for $7k off and 0% financing, bought my winter tires/rims for $450 off the forums, the premium options that didn't come with my STI for 2 of what it would have cost from the dealer and, while most of these things aren't necessary, they were had at a fraction of the brand-new cost. I also buy refurb'd when I can, buy games a year or two after they come out at 1/3 the cost and with added content, and have a 9 year old HDTV that I got for $75 (the cost of a bulb replacement after it "died.")

We all choose our wants and how much we're willing to pay for them. I think it would be foolish of me to complain about how much I spend on things I didn't need in the first place, so I enjoy them, even if that game I just HAD to buy sits on my desk for months, even after a few more games get rotated in beforehand.
 
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Nobody likes sales taxes, or any taxes, but then nobody complains about government services, except for those that they don't use or think they'll need, which are of course a pure waste.
In private party transactions, most sellers will agree to put a lower price on the title than what actually changed hands, saving the buyer a little bit (or a lot) in sales taxes.
After all, the price of a used car is entirely a matter of its condition, which can vary from cherry to trashed.
The title folks aren't going to see the car, but even if they do, the buyer may have just gotten a killer deal.
Don't ask me how I know this.
 
I can accept sales tax, but not property tax. Paying property tax on you car is beyond the pail. So is home property tax. You don't really own your property if it's subject to property tax.
 
Originally Posted By: Tdbo
Originally Posted By: earlyre


mostly true. Friend of mine in Columbus, few yrs back was in desperate need of wheels, bought a REALLY poopy frankentruck s10 for $500. maybe 4 months later the engine blew (i think his dad said it threw a piston or some such(it was 8 yrs ago..) when he got his next poop-tastic car (I think adam sandler wrote a song about it...) the BMV wouldnt let him transfer the plates,b/c they had been on a truck.
same plate stock - 3 letters 4 numbers- nothing on the plate to indicate "truck" or "non-comm". So he had to shell out another $70 for another set of new plates, simply b/c they had been on a truck.



They either changed the law or he went to the wrong BMV. I bought a new Ranger and traded it 18 months later for a new Explorer. They transferred the non-commercial plates onto the Explorer and then on my birthday, I then got new non-com plates for the Explorer.


ah, yours were still to a truck, i should have clarified his attempt was from a truck (S10), to a car(Lumina)
 
Before the lock, this is one of the things IL does reasonably well. Yeah, plates are $99/year, so not there. But once a car is old enough, the tax is based on age.

They also allow you to transfer plates, for a fee. You would pay for a new title regardless, so that's a wash.

If you trade, sales tax is on the difference.

You can usually do better if you sell outright, but you better make sure you run the numbers to see if you are getting 6.5% more for your private party sale than a trade at the dealer.

Of course, buying an older car at a dealer is bad because you pay full sales tax and not the graduated scale for the private party purchase.

Can't win 'em all. Of course, we have one of the highest gas taxes in the nation.
 
I know someone who traded vehicles with someone else and had to throw in $2000, so they simply put $2000 on the title as the sale price.
 
Originally Posted By: mechanicx

True, Ohio use to have smooth, well maintained roads. Now they're all rough even the very few ones they've newly repaved. Taxes have gone up but the roads keep getting worse. I guess it's another cost of industry outsourcing and less tax base.


For years I have noticed that when you cross the Michigan-Ohio line at Toledo the road suddenly becomes very smooth. Pretty sure Michigan has the bad road and when you enter Ohio it is very smooth.

Another state that I heard takes great care of their roads is Kentucky.
 
Originally Posted By: mechanicx
I can accept sales tax, but not property tax. Paying property tax on you car is beyond the pail. So is home property tax. You don't really own your property if it's subject to property tax.
Yeah, you don't really own your house, just stop paying property taxes and see who will own in in a couple years. Over a lifetime you probably pay more in property taxes than you paid for the house--now that ain't right!
 
Most folks pay more in interest on both homes and cars than they do in taxes.

There are some who get 0% financing on their cars, or low rates on their homes. But I don't think that's your average Jane or Joe. So for most, interest will be a higher cost than sales or property taxes.
 
Originally Posted By: TallPaul
Originally Posted By: mechanicx

True, Ohio use to have smooth, well maintained roads. Now they're all rough even the very few ones they've newly repaved. Taxes have gone up but the roads keep getting worse. I guess it's another cost of industry outsourcing and less tax base.


For years I have noticed that when you cross the Michigan-Ohio line at Toledo the road suddenly becomes very smooth. Pretty sure Michigan has the bad road and when you enter Ohio it is very smooth.

Another state that I heard takes great care of their roads is Kentucky.
We learned up here in New England w that fixing a road WELL produces fewer union jobs than repaving it every few years. New Hampshire has the best roads in the region. Tourists like it. Body Shops, I am sure, contribute to the orange barrel fund, hitting one is good for their business. THey also pray for snow and ice.
 
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