The uproar regarding potential 40% increases of annual vehicle tax bills could soon subside.
House Bill 6 — sponsored by more than 40 state legislators — passed unanimously Wednesday afternoon, and now awaits the State Senate floor.
The bill asks for an amendment of KRS 132.485, requiring the average trade-in value — and not the rough trade-in value or the clean trade-in value — be used as the standard values for motor vehicle and property tax purposes. It would grant tax refunds for tax overpayments, would require the posting of tax refund information, and would retroactively apply for all motor vehicles assessed on or after January 1.
Declared an “EMERGENCY” bill in the House, its effectiveness was bi-partisan. District 9 Representative Myron Dossett described the legislation as a major correction, resetting values to 2021 levels.
In January, state officials began notifying county officials that the 2022 overall valuation of vehicles would go up roughly 40% — in what was a direct link to the outrageously rising values in the used and new vehicle market across the country.
Dossett iterated that the massive increase in taxes has already impacted regional vehicle owners.
Unintended or not, the value of used vehicles ballooned both during and post-pandemic, as new vehicles became more scarce because of supply chain shortages and depleted assembly lines caused by the coronavirus pandemic.
Now, supply and demand are both as high as ever. Dossett added this legislation was quite similar to something he introduced two weeks ago. And while this isn’t his bill, he’s pleased something is being swiftly done to reverse this error.
Republican Representative Sal Santoro, the bill’s leading sponsor, told the Associated Press the bill has already received a considerable amount of feedback from Kentuckians — and that a problem needed to be fixed.
