Today’s Pilot had a letter to the editor from a Virginia Beach resident complaining about a “back-door tax increase” because the car tax relief is only 67% this year as opposed to 70% last year. The letter blames Commissioner of the Revenue and 2nd Congressional District candidate Phil Kellam for the increase:
A supervisor from the Commissioner of the Revenue’s office told me that the statement on the back of the tax bill was written by Commissioner Phil Kellan to explain the 67 percent figure, but she did not know why no mention was made of the 3 percent decrease.
For the owner of two cars assessed at $10,000, this is a back-door increase of $22 in taxes. While the amount isn’t great, the methodology does not reflect well on Mr. Kellam, who aspires to be our new 2nd District congrssman.
I guess this guy wasn’t paying attention when this same issue came up in Norfolk and former governor Jim Gilmore denied responsibility for it. Here’s the deal: almost all of us are going to see our car taxes increase this year due to the General Assembly capping car tax reimbursements to localities. It’s going to be a statewide problem and I really wish the newspapers would do their jobs and write about it. It is unfair for the Commissioners’ offices to take the heat for something outside of their control.
So far, the capped reimbursements work out to 60% relief in Norfolk, 62% in Chesapeake and 67% in Virginia Beach. I have not seen any bills yet from Suffolk or Portsmouth.
VIVIAN J. PAIGE | All Politics is Local 
Interesting that the message about the 67 percent figure was written by the Commissioner. Billing is the responsibility of the Treasurer.
Does that vary by locality? I understand that the bills here in Norfolk come out of the C of R’s office.
Not sure; in my locality, once the Commissioner “certifies the book”, the info is made available in the computer system, the tax rate is applied, after which the Treasurer prints the bills, mails the bills and collects. PPTRA messages are printed on behalf of the Treasurer. Maybe this year we should add a “thank you” on behalf of Gilmore?
Interesting. And if you haven’t printed your bills yet, I think that “thank you” would be appropriate 😉
How is this affecting Arlington? What percentage of the car tax bills are being covered by the state?
About the same as VA Beach. We increased the rate from 4.40 to 5.00, which means that BT tax revenue will increase, therefore, there will be an overall personal property revenue increase.
Oh, so you just increased the rate instead of reducing the credit. That was bold – and makes you look like the bad guys instead of the state.
Our rate is $4.00.
The credit will probably be reduced also. I don’t yet know by how much. We have a Fall billing, so we are working the numbers. The County Board could use the increase in business revenue to supplement the car tax, but whether they elect to do so remains to be seen, what with the increased ceilings of income and net worth to qualify for RE tax relief. That will cost us a lot more this year.
Interesting – I didn’t realize you had a fall billing. All the localities around here use the June deadline
It seems the crux of the issue is that capping the car tax rebate at $950M then makes it a “percentage” play at the localities, ie. each locality presents their bills and get reimbursed a “percentage” according to the overall bill from that locality.
Therefore, if the value of cars was X last year, and you divide that by 950M, then your value of cars is X+3% it still divides into the 950M and the locality get 3% less in reimbursement from the 950M “pie”.
I would like to know since the GA will not now reimburse the localities for any delinquent tax payers, what happens to those funds? Let’s say just 1% of all tax payers are delinquent, and if the GA withholds that amount $9.5 M, does it go to other localities that have a lower delinquency rate, or does that $ stay in the General Funds, unappropriated?
This would seem to favor more affluent localities, if it goes to them..
I’m not sure of the exact forumla for reimbursement; perhaps Ingrid can weigh in on that. My guess is that the dollars have been already given to the localities and that it is the localities that will get to keep all of the money. Again, Ingrid can probably explain that better.