Each year Georgians perform their emissions check and pay their automobile ad valorem tax around their birthday. However, in 2012 the State of Georgia passed a new law that will effectively eliminate the tax for new vehicles purchased after 1/1/2012. The way the state is making up the decline in tax revenue is to start taxing private sales of vehicles as of 3/1/2013. Here is a synopsis of how the tax works and how it may affect you depending on the date you purchased your car:
New vehicles purchased from a dealer after March 1, 2013
If you purchased a new car after 3/1/2013 and it’s a 2012 model or later, there is no longer a state sales tax. Instead, you will pay a one-time 6.5% ad valorem tax. This tax climbs to 6.75% in 2014 and 7% in years 2015 and beyond. The tax isn’t based directly on the agreed upon price. The state has “assigned” a value on all new cars, and so the 6.5% applies on that value, not your negotiated price. You can find the state assigned price on the Georgia Department of Revenue’s website. Once you pay this one-time tax at the time of purchase, each year you simply renew your tag and pay the tag fee which is generally around $20.
New vehicles purchased from January 1, 2012 – February 28, 2013
If you purchased a 2012 model or later car between January 1, 2012 and February 28, 2013, you paid the regular sales tax on the car, not the new ad valorem tax. However, you have can opt into the system before you renew your tag for the year. Depending on the county you live in, you may have already paid sales taxes that exceed the new ad valorem tax, and hence you don’t owe anything on the vehicle. So for example, if you paid 7% sales tax to purchase the car, you have paid more than the 6.5% ad valorem tax, and therefore you can opt into the system at no additional cost. The state has set up an online tax calculator that will help you determine what you need to pay to opt in. The website address is motor.etax.dor.ga.gov. If you determine that opting into the new system makes sense for you, then you would need to go to your local tag office prior to your registration (generally your birthday) and fill out some forms to opt into the new system. As of this article date, the state doesn’t have an on-line system to opt in.
Private sale vehicles purchased from March 1, 2013 onwards
If the car you purchased was a private sale; so from your friend, Craigslist, Autotrader, etc., the new 6.5% (or higher after 2013) tax will apply. The purchaser will be responsible to pay the tax at the time of auto tag registration.