Excise tax bill in MA?!?

Well, it is tax deductible...and it goes down every year...

gnychis said:

I moved from CA to MA in late 2014, and was shocked to get a bill in the mail from the City of Somerville requesting $1000 for excise tax on my car. To be frank, what the **** is up with this? I have to pay a tax every year on a car that I've already paid a high amount of tax on already? This is absurd. No wonder everyone owns crappy cars in this state. The horrible state of the roads in MA, coupled with how horrible parking is in this city, and on top of this tax makes me want to sell this car in MA. There goes all of my "fuel savings" ... where are the MA perks? Anyone I can write to about this, where I'm sure my complaint will fall on deaf ears?

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It's not just MA where cars are subject to property taxes or excise tax at Registration. In ME you pay a front-loaded 7.15% of the MSRP over the first 5 years, and then 0.4% thereafter. At least being fixed to MSRP you know what you're getting into.

Indiana and my county had a $700 tax yearly until recently and I still pay $400 yearly excise tax, though the surtax and wheel tax have lapsed.

California taxes the value of vehicles, too! Perhaps it's at a lesser rate. I'm not sure. It's called the Vehicle Licensing Fee (VLF), and you have to pay it every time you renew your registration.

In Virginia, it is highway robbery on car owners every year, we are taxed 4.57% of the BB value of our cars, which means we pay $4570 on our $100000 tesla the first year on top of the sale tax of 4.07% on cars. We pay a bit less the years after, but its value still based on BB. That prevented a lot of us buying a luxury car. So I think you are lucky you only pay $1000.

In Oregon it's no sales tax at purchase, no excise or property tax on the car, ever, just a registration fee. Depending on your county something like $43-$62 a year. Plus extra for different plates or a vanity number...
You are living in the wrong state it seems

We should point out that it rains a lot here in Oregon though.

Thumper said:

We should point out that it rains a lot here in Oregon though.

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But contrary to MA (where the OP moved) we don't have feet of snow and weeks of single digit temperatures... just saying...

Welcome to Taxachusetts. Where the taxes are rampant and plentiful.
You could always move an hour north and save your income and sales tax.

anthony said:

Welcome to Taxachusetts. Where the taxes are rampant and plentiful.
You could always move an hour north and save your income and sales tax.

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You'll still pay excise tax on the car. They may not call it "excise tax", but it's still a variable registration fee, paid to the town based on the car's value, so it's the same net effect. See, it's a "fee", not a "tax". Get it? (Don't feel bad, I don't either...:smile.

At least NH gets you up front. Don't want to pay? Fine, don't register your car. MA (true to form) has a whole bureaucracy built around collecting excise tax after you register.

And that "no income tax"? Better not have any significant interest and dividend income, or you're in for a big shock.

In my experience, the rumors of higher property taxes in NH vs MA don't hold water - I pay $20/1000 in MA, and $15/1000 in NH.

gnychis said:

I moved from CA to MA in late 2014, and was shocked to get a bill in the mail from the City of Somerville requesting $1000 for excise tax on my car. To be frank, what the **** is up with this? I have to pay a tax every year on a car that I've already paid a high amount of tax on already? This is absurd. No wonder everyone owns crappy cars in this state. The horrible state of the roads in MA, coupled with how horrible parking is in this city, and on top of this tax makes me want to sell this car in MA. There goes all of my "fuel savings" ... where are the MA perks? Anyone I can write to about this, where I'm sure my complaint will fall on deaf ears?

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See here: Frequently Asked Questions - Motor Vehicle Excise

If I back into the calculation, it looks like they're using $66k for the MSRP:

$66k * 60% (Second year after year of manufacture) * $25 ($25/$1000 of value) = $990

3 more years and you're down to $165. For comparison, I pay $250 for a 10 year old 911.

One thing you definitely SHOULD check is whether the value basis of your car is correct. Because Model Ss are fairly rare, there are many examples where a town has used the value of, say, a Signature Performance P85 as the value for all Model Ss. You are well within your rights to dispute the tax basis.

See the discussion over here: Tesla and Town Hall -- $50K too high on excise tax

(By the by, I adjusted the thread title to be more concise.)

gnychis said:

I moved from CA to MA in late 2014, and was shocked to get a bill in the mail from the City of Somerville requesting $1000 for excise tax on my car. To be frank, what the **** is up with this? I have to pay a tax every year on a car that I've already paid a high amount of tax on already? This is absurd. No wonder everyone owns crappy cars in this state. The horrible state of the roads in MA, coupled with how horrible parking is in this city, and on top of this tax makes me want to sell this car in MA. There goes all of my "fuel savings" ... where are the MA perks? Anyone I can write to about this, where I'm sure my complaint will fall on deaf ears?

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Been there, done that! Except it was 1992 when I moved from NJ to MA. Also, I never got the first several bills in the mail until fines started racking up. I was also in Slummerville at the time, coincidentally. So I called them up and get a real rude woman on the phone.. I said I never got any of the previous bills in the mail.. she said "well, if we send them out, we assume you get them". I was like "well, I didn't get them and I didn't know this tax was due".. she said: "Well, it's due every year at the same time, you should have known that you DIDN'T GET THE BILLS in the mail this year and called us".. WTF?? Lady, I JUST MOVED HERE FROM OUT OF STATE, HOW WOULD I KNOW ABOUT A TAX BILL THAT I DIDN't KNOW EXISTED?... she then says, get this: "Well, your friends and coworkers would have been talking about it, so you should have known something about it" -- SHE REALLY SAID THAT!. I was like "um, no, my friends and coworkers don't go around talking about their tax bills all day.". Anyway, it was a long time ago, but I think I ended up having to pay the tax AND THE FINE because I never got the first few bills in the mail. Well, after that year I certainly knew about the excise tax.

And it's not any better here in CT -- same deal with each town collecting a tax on the cars, but yeah, it's not $1000 for a Tesla.

My excise tax this year was about $650 for my 2013 P85+ car. I knew what to expect, so it didn't surprise me much, my town loves me each year when I have to pay excise taxes for several commercial vehicles and I cry each year when the time comes

gnychis said:

Total bummer Thanks for all of the feedback everyone. It's interesting to hear what the other states do on this. I'm originally from PA, and I don't ever remember paying such a tax on cars I owned there (and not in CA in the 1 year I was there). I guess what I can do is make sure that they at least did this calculation correctly.

My total cost of the car was $92,000. The excise tax states that its valuation is $41,950. At the "tax date" the car is over a year old, so that means I'm in the 60% bracket, right? So how does this come out to $961.35?

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I think I figured it out. State info on the calculation: CIS: Motor Vehicle Excise Information

The valuation listed on the bill is the discounted value (ie, MSRP * current year percentage). For my 911 mentioned above, my bill shows a valuation of $10,000 and a tax due of $250. Since the car is 10 years old, its in the "10% of MSRP" category.

So your car is considered to be 1 year old, therefore the valuation for excise tax is 60% of MSRP. That's the $41,950 number. So they're using an MSRP of $41,950/60%, or $69,900.

At a tax rate of $25 per $1000 of value, you would expect to pay 41,950/1000*25, or $1048.75. So why is your bill only $961.35? $961.35/$1048.75 = 11/12. The MA page above says your first year of registration is prorated by month (you only pay for whole or partial months). Did you register in Feb? That would explain it.

I got a bill for $1,350 and have a pretty basic 85 purchased in 2014.

I called the town, which directed me to the RMV. The RMV excise tax division told me that the value is based on the window sticker on my specific vehicle and if it is incorrect, send a copy of the window sticker so it can be adjusted.

I don't understand why I have the highest excise tax bill (for the second year in a row) of everyone on this board and there is nothing I can really do about it.

Any advice?

April 2014, $87,820 after delivery.

I believe the RMV said they were using $88k for my value.

Robert.Boston said:

One thing you definitely SHOULD check is whether the value basis of your car is correct. Because Model Ss are fairly rare, there are many examples where a town has used the value of, say, a Signature Performance P85 as the value for all Model Ss. You are well within your rights to dispute the tax basis.

See the discussion over here: Tesla and Town Hall -- $50K too high on excise tax

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In the thread Robert links, two of us discovered how it works.
-MassDOT uses 93k as the MSRP of the Model S
-Model S MSRP is 79.9, for the 85
-If you have other cars in your household, and do all the math, you may prove for yourself that MassDOT tends to use BASE price, and not the optioned price or what you pay, as the MSRP.
-Petition for abatement, direct to your town. They should forward it to MassDot. Include links to NADA, where Tesla's base prices are shown. Maybe also include evidence your other cars are taxed at base.
-A couple weeks later, you might see abatement notices, to be followed by checks that can take up to six weeks.

We also discovered MA is not fixing the ~93k/80k basis that is being used to assess Teslas. If you're interested in recovering the amounts, you might give this a try. I received a check, yesterday.