NEWS- Tax brake: Late payers lose car tax relief

In 1997, the siren song of "no car tax" lured Virginia voters to send Jim Gilmore to the Governor's mansion. But as of September 1, 2006– the day the new law went into effect– that idea became more of a stick than a carrot for many Virginians. 

On that day, accounts belonging to 12,800 dilly-dallying taxpayers in Albemarle County and a yet-untold number of others in Charlottesville lost the break and saw their personal property taxes skyrocket.

A delinquent Albemarle owner of a $25,000 vehicle might have been expecting a half-year tax bill of $182; now that person owes $535.

The big jump is the result of an amendment to the 1998 bill that rolled back the car tax. Passed by the General Assembly in 2005, the amendment punishes everyone with any outstanding personal property tax delinquency.

Many Virginians may not realize that tax relief is now administered by localities. Instead of a statewide car tax relief of 70 percent offered under the Personal Property Tax Relief Act of 1998, Virginia now gives localities the money to roll back as much as they want.

With $15 million from the state, Albemarle County decided it could foot 66 percent of its residents' car tax bill; Charlottesville opted to cover just 53 percent with their $3.5 million from Richmond. 

But none of this makes a difference to those who didn't pay on time: they've lost all the car tax relief.

"If you had taxes that still needed to be paid after September 1," says Joe Correa, Albemarle's manager of revenue and taxation, "then a bill was generated, disclosing the amount of delinquency. Then you were also billed for the amount of the credit that had been previously provided by the state."

County spokesperson Lee Catlin says she and her colleagues got the word out well in advance.

"An insert went out in October 2005 and April 2006 to all personal property tax holders," she says. "We also did a news release and put it out in our e-news service."

But the town criers didn't stop there. Together, the City and County undertook an "aggressive campaign" in the media, according to City spokesperson Ric Barrick.

Barrick says he sent releases to all media outlets in town and that the Daily Progress and Channel 29, among others, ran stories. "We went beyond the call of duty to let these people who hadn't paid their taxes in the past know they had to hurry up to get what they could."

According to state officials, the tax truancy trend isn't limited to our neck of the woods. Virginians everywhere have been trying to give the taxman the slip, says Virginia Department of Motor Vehicles representative Diane Washington: "This is a statewide issue. We're seeing this from Henrico to Chesapeake and all over."

Is there any recourse for those who missed the car tax boat? According to Correa, there's only one way to fix it.

"These people have to pay those delinquent taxes," he says, "now that those taxes have increased significantly, and they're not going away."

Both City and County taxpayers got fair warning in these mailings about the need to either pay up or lose out on the car tax relief.