DMV Needs to Stop Robbing Taxpayers
If you recently purchased a car from a private party, you may have paid too much tax to the California Department of Motor Vehicles.
I’ve been hearing complaints from constituents that DMV charged them a higher city tax rate when they don’t actually live within city boundaries.
These constituents were forced to jump through hoops to prove they didn’t owe the higher tax. As their elected representative, I was happy to assist them in obtaining refunds, but DMV should have never overcharged them in the first place.
What’s worse is that these overcharges are not isolated incidents, but rather a systemic problem resulting from DMV’s bizarre reliance on zip codes to determine tax rates.
Sales and use tax rates vary widely across California and change over time. In addition to the statewide sales and use tax rate of 7.5 percent, many cities and counties add voter-approved local taxes. The result is some cities have sales tax rates as high as 10%.
Unlike typical retail transactions, the tax rate for a vehicle sale is based on the address provided to the DMV by the registered owner, not where the sale took place. If you buy your car at a… Read More