Board proposes tax decrease
Published 6:52 pm Friday, October 1, 2021
In an effort to help citizens who may be affected by higher personal property taxes, the Charlotte County Board of Supervisors (BOS) is proposing a temporary reduction in tax rates.
A public hearing will be held on Monday, Oct. 4, at 11 a.m. in the county administration building to hear comments regarding the proposed tax rate.
The county’s current personal property tax rate is $3.95 per $100 of assessed value.
The proposed personal property tax rate is $2.60 per $100 of the assessed value of the personal property, which is $1.35 per $100 of assessed value less than the current.
The decreased tax rate would be effective for the Fiscal Year 2022, which began on July 1, 2021, and will extend to June 30, 2022.
The decision for a temporary lower tax rate came following an announcement made by Commissioner of the Revenue Naisha Carter during the September BOS meeting that vehicle owners could see increases in their personal property tax bills this December.
This is not due to a tax rate increase or reduction in tax relief but rather to increases in used vehicle values.
“With the COVID-19 pandemic, everything has gone up, and since March 2020, used car prices and trade-in values have gone up,” Carter said.
According to Carter, her office uses the clean trade-in value established by the National Automobile Dealers Association (NADA) as fair market value.
“We assess each July 1, and this year we assessed approximately 15,000 pickups, SUV’s and sedans, and out of those, approximately 3,000 of those vehicles will see significant increases in assessed values,” Carter said.
According to Carter, those vehicle assessments mean citizens could face a 25% to over a 100% increase in taxes than they saw in 2020.
“This increase will range from a $40 to $50 increase to several hundred dollars in additional taxes,” Carter said. “It is not just here in Charlotte County. This is something that is being seen all across the state.”
Historically, vehicle values tend to depreciate from month to month. As such, the predicted value of any vehicle would be lower than the value of that exact vehicle the previous January. In early 2020, vehicle values were trending as the industry customarily expected.
In March, COVID-19 altered the anticipated trends of the automobile industry. As a result, all major vehicle valuation services, not just NADA, indicated increased market values between January 2020 and January 2021.
In the summer of 2020, prices increased by over 10% for the U.S. used car market as a whole.
COVID-19 related closing of certain auto manufacturing plants for the necessary production of ventilators and other personal protective equipment caused a further inventory reduction.
Also, large fleet companies like rental agencies and car services choose not to replace their inventory, leaving the market with fewer preowned vehicles.
Cars.com data shows new-car inventory dropped more than 15% between February and April 2020.
When new vehicle prices rise and inventory falls, shoppers opt for used cars. Consequently, the used-car stock declined, and prices skyrocketed as well.
“I do feel that it’s unfair to the citizens of Charlotte County to pay more on a car than they did last year,” BOS Chairman Gary Walker said. “If you sold a car and made some money, that is different, but if you didn’t sell your car, then it’s worth what it was last year and maybe a little less. Our people have paid and paid, and none of us has benefited from the pandemic, and I just don’t think this is fair.”