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I was speaking to a L-Talk member interested in buying my 6.0. He mentioned the fees on the California registration of some 2% of the cars value.

I wouldn't drive a Lamborghini in that state.

I'd move out of state.

That's NUTS. How do you guys put up with that and why dont citizens stand up for being taxed ever year on something you've already paid tax on?

The Republik of Kalifornia is crazy.

-Ben
 

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Could be worse. You he could live in Canada.

My friend was explaining how you have to pay tax on second hand cars aswell.
 

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Well I don't know where the WORST is but in Washington State WE pay 8.9% SALES TAX ON THE SELLING PRICE OF THE CAR, plus License tabs and misc fee's of approx .8% depending what part of the state you live in.

This for both NEW and USED! You pay the license tabs and fees EVERY year, the Sales tax only ONCE when you buy the vehicle.

RoyToy2003 Seattle
 

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One way to get around it is to lease the car; and payoff a balloon at the end.
Otherwise, you pay about 2% to register it; and the continuing annual fees are huge too. I am not sure the WA is worse though because taxes are around 8.75% in CA and registration fees are about 2%, so the grand total is around 11% for taxes and registration fees :(

What's even worse is that CA bases taxes and registration fees on the full amount of a purchase, even if there is a trade-in (far worse than the registration fee craziness).

Example: Let's say you purchase a Ferrari for $150k in January. You pay your registration and taxes which total app. $15k-$17k depending on your county. Then, in February you decide to trade this car for a Lamborghini. Let's say the dealership gives you $150k on the Ferrari and the purchase price is $250k for the Lambo. Even though you just paid taxes and fees on the $150k Ferrari, you will still be responsible for paying taxes and registration on the full amount of the Lambo ($250k) which is app. $30k. So in 2 months you get taxed and pay fees on the total purchase price of each car (a total of $45k+); regardless of trade-in or down payment. This is robbery! In most states you would just pay taxes and fees on the difference of the 2 cars (ie you trade a $150k value car on a $250k value car and you pay taxes and registration on the $100k difference). You can see how this scenario becomes much worse if you buy and trade a few cars a year.
 

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So you pay sales tax on used cars in the US aswell.

Thought it was amazing when my Canadian friend told me. It means you take a huge depriciation hit on any new car.

The way I understand it:

1) You buy a car for 100k + 10% (hypothetical) sales TAX = 110k
2) You want to sell the car
3) Buyer has to pay 10% on the purchase price so you have to sell for 100k - X (where X is a large enough difference to justify the guy not just buying a new one).

We only pay the sales tax (VAT) on new cars here in the UK. Although it is quite high (17.5%). Cars still depreciate considerably here. Can't imagine anyone would buy a new car if you also lost the VAT on it when you came to sell it.

Isn't your system double taxation? Thats a big no, no here. You only pay the tax on something once.
 

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The California Vehicle License Fee is heavily discounted right now (as in 66% off) thanks to Arnold.
 

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In Canada you have to pay sales tax of 15% on used cars except in Alberta which only has 8% tax. The tax is based on the Red Book Value of the vehicle or the purchase price, whichever is greater. This stops those sneaky types that try to get a reciept for 1/2 the actual purchase price.
 

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Just to clarify: In California, there is no sales tax on used cars. It's called a "Use tax". However, for practical purposes, it's the same thing.

When a dealer sells a used car, the use tax is collected prior to the car being released to the new owner. During a private sale, the use tax is due upon the sale of the car but is collected the moment the buyer attempts to re-register the car under his/her name at the DMV.
 

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Yes, to sum it up it is very similar (if not identical) to double taxation. Last year I purchased and sold three cars. In the state of CA it cost me over $40k to do this. If I lived in almost any other of the states it would have cost closer to $10k. That's a big difference indeed!!
 

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Don't complain too much about double taxation.

In Virginia we have to pay "Personal Property Tax" on each and every motor vehicle each and every year!!!

In essence we pay the sales tax every year for the same car, truck, boat, trailer (even though it does not have an engine), etc....

Each County or City sets their own rate so it varies through out the state what you actually pay.

Amounts to the same as a Realestate tax for any registered "thing".

Even Dealerships are required to pay this tax on their inventory as of January 1 of that particular year. A few Dealerships actually transport their inventory out of state the week befor and bring it back the week after. They get away with this because they are taxed on actual vehicles physically there only.

Individules are taxed on registered vehicles (again January1) and does not matter if they are physically there or not.

:evil:
 
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