By Staff
Leada Gore, Hartselle Enquirer
A change in Hartselle’s tax structure won’t impact car dealers here, who, thanks to the set-up of the city’s sales tax, still enjoy an advantage over their Decatur counterparts.
Mayor Dwight Tankersley said there is confusion centering on the 7.5 mill property tax and how it applies to vehicle purchases. The ad valorem taxes aren’t applied at the time when the car is bought, but when the buyer purchases their car tag. That’s when the increase in property taxes will be applied.
In fact, where the car is purchased doesn’t determine the taxes assessed against it. That’s determined by where the vehicle is registered.
Taxes are determined by the vehicle’s assessed value. According to the Morgan County License Commissioner’s Office, that figure is determined by taking the average retail value from national reports and then multiplying that figure by 89 percent. Most private party vehicle are assessed at 15 percent of that amount; motorcycles, large trucks and commercial vehicles are assessed at 20 percent.
If voters approve the 7.5 mill property tax on March 11, the additional taxes on a $20,000 car would be $22; the additional cost for a $25,000 car would be $28.
As part of the tax increase plan, city officials have said they will institute a half-cent sales tax increase if the property tax is approved. That sales tax wouldn’t apply to certain purchases, including vehicles.
Hartselle’s dealers charge .75 percent sales tax on vehicles. Decatur’s rate is 1 percent. Those figures won’t change.
Lee said items such as automobiles, lodging, fuel and certain large equipment used in manufacturing would not be impacted by the sales tax increase.