Depending on how two pending items shake out, Carroll County residents could be faced with paying 50 percent more in personal property taxes for their vehicles for Fiscal Year 2016-2017.
Carroll County Commissioner of the Revenue Fran McPherson broke the news to the Carroll County Board of Supervisors during the board’s June 13 meeting. She said she wanted to update supervisors on Virginia’s Personal Property Tax Relief Act (PPTRA) and how it relates to the new Senate Bill 375, which will be placed into effect July 1.
“At this point I don’t know if it is going to affect this year’s taxes or next year’s because our tax day is January 1,” McPherson said. “We are hoping it will be January 1, 2017. If not we have to go back and pick up all the pickups that are weighted between 7,500 and 10,000 pounds, which is going to drop the PPTRA percentage the taxpayer receives on their tax bill.”
McPherson then made some charts to explain how Carroll County citizens potentially could be affected by changes to their personal property tax bills. She began by taking a 2011 Chevrolet Silverado with a loan value of $15,075. With Carroll County’s current personal property tax rate of $1.95 per $100 of valuation, and without any changes to the PPTRA, a Carroll County taxpayer would pay $186.90 in personal property tax on the Silverado – the same as it would have in 2015. However, she said if the board approved the proposed 35 cent tax hike to the personal property rate, a rate of $2.30 would lower the PPTRA to 27.25 percent, which calculates into a personal property tax payment of $252.25 for a Carroll County tax payer.
If the Senate Bill 375 goes into effect this year and Carroll County raises its personal property tax rate to $2.30, the tax bill rises to $273.92 on the 2011 Silverado – an increase of $87.02 from the previous year.
“Those percentages are not set in stone. We have no way of knowing yet, but I just did a ballpark figure and the increase for 2015 to 2016 on this pickup truck is going to be $87.02,” McPherson said. “I wanted you to have all this information before you make your decision to raise the levy. I don’t think we will have anybody happy about this. If they pass this and don’t let us wait until January 1, 2017, I have to implement it this year.”
Board Chairman Joshua Hendrick said it is not a matter of if, but when. The new law will go into effect on July 1, it’s just unclear if it will be for this upcoming tax year or the next. Supervisor Phil McCraw wanted to know if that included any vehicle with weighted tags.
“As long as you do not you use it in a business. If you use it in a business or you depreciate it on a Schedule C you do not qualify, and that also includes if you claim mileage on Schedule C,” McPherson said.
To show how the same scenarios would affect smaller vehicle owners in Carroll County, McPherson also ran the numbers on a 2011 Chevrolet Cruze. Under Carroll’s current personal property tax rate of $1.95, a Carroll taxpayer would pay $108.79 on the vehicle. With the $2.30 tax rate, a 2011 Cruze owner would pay $146.83 on the same vehicle. With the $2.30 tax rate and the additional Senate Bill 375 added, a Carroll citizen would pay $159.45 on the same vehicle, an increase of $50.66 from 2015.
“So it will impact everybody,” McPherson said, noting citizens will see an increase on their personal property tax bills because of the PPTRA regardless of what Carroll does with its personal property tax rate.
Another factor will be how many Carroll County vehicles come in valued at less than $1,000. The PPTRA pays the whole tax bill if a vehicle is valued less than $1,000, she said.
“So if we pick up half of them that are valued at less than $1,000, that is going to kill the percentage each taxpayer gets even more,” McPherson said, adding that she ran a query and found Carroll is looking at 2,500 to 3,000 vehicles that meet the criteria of less than $1,000.
Allen Worrell can be reached at (276) 779-4062 or on Twitter@AWorrellTCN