Many agree there should be fair car tax values, but will it happen?

John Howell
Posted 12/9/14

The man who led the car tax revolt says all that is needed to bring equity to motor vehicle valuations is the change of a couple of words in the law.

Rob Cote of Warwick told the Rhode Island …

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Many agree there should be fair car tax values, but will it happen?

Posted

The man who led the car tax revolt says all that is needed to bring equity to motor vehicle valuations is the change of a couple of words in the law.

Rob Cote of Warwick told the Rhode Island Vehicle Valuation Commission Friday afternoon he wouldn’t have a beef if in place of motor vehicles being valued on their “clean retail value,” valuations for tax purposes were based on their “average trade-in value.”

The car tax revolt gained momentum when the state and former Governor Donald Carcieri virtually eliminated a plan to phase out the car tax. In dropping the plan, the state took away state aid to cities and towns and gave them the option to remove all but $500 of the $6,000 exemption on valuations.

With reduced exemptions, the taxable values of motor vehicles climbed, and many people found their cars and trucks were being valued at more than they could sell them for or what they had paid.

Cote is not alone in calling for fair valuations. Letters in support of changing the valuation methodology were filed by state Reps. K. Joseph Shekarchi, Joseph McNamara and Grace Diaz, Governor-elect Gina Raimondo and Providence Mayor-elect Jorge Elorza.

“With so many residents of our state facing economically-challenging times, it is absolutely imperative that the process for calculating the values of vehicles subject to the car tax is fair, reasonable and realistic,” Raimondo and Elorza wrote in a joint letter.

Shekarchi said the appeal process “must be more transparent and consumer-friendly.”

In his comments to the commission, Shekarchi said, “I ask you to get it right.” He said people are “losing confidence in government” when they have a $5,000 car that, for tax purposes, is valued at $10,000. He gave the commission six weeks to make changes or he would introduce legislation to alter the system on Feb. 1.

Hillary Davis of the ACLU asked to commission to use “the average value” for vehicles. She said she would “love to hear the justification that it is fair,” adding that the lack of appeals is not an indication that people believe it is fair, but that they have lost faith in the system.

“We believe it’s a legislative issue,” commission member David Quinn responded to questions why the commission had not made changes. “We’re open to any legislative inroad to that.”

As Cote had notified those who had joined with him in prior appearances before the commission and the media, a boisterous crowd was expected at Friday’s hearing. Two Capitol Police officers were present to handle the turnout. But fewer than a dozen, including members of the news media, were on hand.

The effect of a change in valuations could be significant for cities and towns.

Quinn estimated using trade-in values as a basis would reduce municipal car tax revenues by 30 to 40 percent. If that’s the case, in Warwick alone, where 110,000 vehicles generate $23,019,748 in taxes, it could mean a $9.2 million cut in revenues.

Unlike property taxes that municipalities can adjust, state legislation froze the local motor vehicle tax rate in the late 1990s. Municipalities can adjust exemptions, as Warwick did. After rolling back the exemption from $6,000 to $500, Mayor Scott Avedisian and the council restored an additional $1,500 following the car tax revolt led by Cote.

Rather than looking at the issue from the perspective of how municipalities are going to make up for lost car tax revenues, Cote argues municipal leaders must cut spending.

“No one is addressing why we need the money, no one is going down that road,” he said after the hearing.

He said Warwick employees have 20 paid holidays from which unions get to select 14 by contract, which is four more days than federal employees. He said such perks are being given away by elected officials in order to get elected and re-elected.

Apart from the basis of valuation, North Providence Town Council President Kristen Catanzaro urged for uniformity in application of the values. She said 33 municipalities apply a limited depreciation schedule to vehicles that ends up valuing some older vehicles at more than newer ones of the same make and model.

“There needs to be a uniform methodology throughout the state,” she said.

Comments

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  • JohnStark

    Once you allow something called a "vehicle tax" to become law, the camel's nose is in the tent. The camel has now entered the tent and taken a dump on the floor. Beaurocrats are now scurrying to determine the best location in the tent to relocate that pile of excrement. Better to get the camel out of the tent, along with his excrement. Rhode Islanders are taxed to death. This is yet another example why the state is unattractive to business and folks are leaving. It's past time to get rid of this arcane tax altogether!!!!!

    Tuesday, December 9, 2014 Report this

  • Drew

    What's this phenomenon of people sticking cameras in others faces "because it's their right" such as protestors accross the country and this guy in the picture? I'm not familiar with who he is. Local news station guy perhaps? If cameras were put in their faces they'd freak out I'm sure.

    Tuesday, December 9, 2014 Report this

  • Unionthug

    It's Rob Cote... king D Bag and camera man. He was out following DPW today....

    Tuesday, December 9, 2014 Report this

  • Scal1024

    Its not the message of lower car taxes that has people disinterested, its the messenger, Rob Cote.

    Wednesday, December 10, 2014 Report this