Little’s office has worked with the Cherokee County Marshal’s Office to have a marshal at each of Cherokee County’s two tag offices for added security once the tax goes into effect. Beginning Friday, the marshals will be on hand every day for an indefinite time, the tax commissioner said.
Little said the public could react strongly to the drastic changes TAVT institutes and the vast confusion within the community about what the changes mean.
The title ad valorem tax after March 1 essentially does away with the old system for charging tax on car tags for any vehicle purchased. The changes apply to both purchases from car dealerships and private sales.
Anyone purchasing a vehicle after March 1 will pay 6.5 percent of their vehicle’s value (market value or sale value, whichever is higher.) This will be a one-time fee mostly replacing the annual ad valorem fee, often called the “birthday tax” as it is charged on drivers’ birthdays.
This doesn’t eliminate the annual ad valorem tax entirely, though. “It just makes that cost a lot lower, as low as $20 a year,” Little said.
Drivers who purchased their vehicles prior to March 1 will now fall into one of two different groups: those who purchased their vehicle prior to March 1 but after Jan. 1, 2012, and those who made their purchase prior to Jan. 1, 2012.
Those who purchased their vehicle between Jan. 1, 2012, and March 1 have the choice of paying through TAVT or the old “birthday tax” method.
Those who purchased their vehicle prior to Jan. 1, 2012, will simply stay on the old system of paying their full ad valorem tax each year on their birthday.
These groups are further separated by whether a purchase was private or from a dealer, as new time frames are being put into place for how long a new car owner has to get a tag.
Little said the 30-day grace period drivers once had for that task will go away Friday, when the new periods will be set: seven days for those purchasing a vehicle privately and 10 for those who patronize dealerships.
That means that after seven or 10 days of purchasing, drivers can be fined when found operating a new vehicle without a tag.
Some car buyers, though, Little said, don’t have the option of getting their tag within the allotted time.
“A lot of times, people are still waiting on the title. In those cases, we recommend those people come in and we’ll issue them a temporary tag,”
TAVT also affects newcomers moving into Georgia. Little said this is where she sees the most potential for conflict, as new Georgians will be perhaps the most caught off guard.
Effective Friday, any resident who moves into Georgia will be put on the TAVT system and have 30 days to get a Georgia car tag.
The state, however, will not make these new Georgians pay their TAVT in full.
Little said Georgia has decided to bend a bit with the newcomers and allow them to make two payments: one 50 percent payment within their first 30 days in the state and another within 12 months.
What TAVT will mean for drivers in the long run, Little says, is yet to be seen and will depend on the specifics of each situation.
“People who buy a car from a dealership now shouldn’t be affected much,” the commissioner said, “because the new system does away with sales tax on dealership sales and the charge on new vehicles is nearly the same as what the sales tax would have been.”
This could change a bit in the coming years though as, Little said, the tax rate is scheduled to increase annually for at least the next two years, rising to 6.75 percent in 2014 and 7 percent in 2015.
WHAT IT MEANS TO TAG OFFICE VISITS
Little said she expects the overall customer experience at the tag office will now change.
“We have estimated that the new system will result in at least an additional six minutes in the office, for each customer,” Little said.
Also, her staff has new software to get accustomed to and that they have, as of yet, had little or no experience with.
“We have only seen a few screen shots of the new program we’ve been given to process appeals on the amount charged to drivers in house. Eventually, this will be helpful, but initially it could cause some delays,” Little said.