This bill decreases the excise tax imposed on motor vehicles for the first year from 24 mills to 12 mills, for the 2nd year from 17 1/2 mills to 8 mills and for the 3rd year from 13 1/2 mills to 4 mills and imposes a 4 mills rate for the 4th and succeeding years. This bill also exempts from the excise tax imposed on motor vehicles the first 3 model years of a hybrid gasoline-electric vehicle, a fuel-cell-fueled or hydrogen-fueled vehicle or a highly energy efficient vehicle that has a highway fuel economy estimate of at least 40 miles to the gallon. After the first 3 years, the rate of excise tax is the same as on other motor vehicles of the same age.
This bill also exempts from the sales tax 100% of the sale or lease price of a new hybrid gasoline-electric vehicle, a fuel-cell-fueled or hydrogen-fueled vehicle or a vehicle with a highway fuel economy estimate of at least 40 miles per gallon.
Intent and Content
Prepared by the Office of the Attorney General
This initiated legislation would reduce the rate of the excise tax on motor vehicles less than six years old. This is the tax that owners of vehicles pay each year in order to register their vehicles. The excise tax is collected and retained by the city or town where the owner of the vehicle resides. If the vehicle owner lives in the unorganized territory, the tax is deposited in the unorganized territory fund in the county where the owner resides.
The extent of the rate cut varies depending on the age of the vehicle. The legislation provides a rate cut of about 50% for one and two-year old vehicles (from 24 mills to 12 mills in year one, and 17 1/2 to 8 mills in year two); 70% for a 3-year old vehicle (from 13 1/2 to 4 mills); 60% for a 4-year old vehicle (from 10 to 4 mills); and 38% for a 5-year old vehicle (from 6 1/2 to 4 mills). The legislation does not change the current rate of excise tax (4 mills) for vehicles older than 5 years. Each mill constitutes a tax of one dollar for every $1,000 of the manufacturer's suggested retail price for the vehicle. (For example, a 4-mill tax rate means that the vehicle owner would pay a tax of $4 for every $1,000 of the suggested retail price for that vehicle.)
Hybrid gasoline-electric vehicles, vehicles powered by fuel cells or hydrogen, and other vehicles with estimated fuel consumption rates of at least 40 miles per gallon on the highway according to United States Environmental Protection Agency testing, would be entirely exempt from excise tax during the first three years. After three years, the tax rate would be the same as for all other motor vehicles of the same age. These vehicles also would be completely exempt from sales tax.
If approved, this citizen initiated legislation would take effect 30 days after proclamation of the vote.
A "YES" vote favors enactment of the initiated legislation.
A "NO" vote opposes enactment of the initiated legislation.
Do you want to cut the rate of the municipal excise tax by an average of 55% on motor vehicles less than six years old and exempt hybrid and other alternative-energy and highly fuel-efficient motor vehicles from sales tax and three years of excise tax?