Updated February 27 at 11:27am

Car-tax hikes leave owners fuming

Overhead Door Garage Headquarters President Scott Grace has more than the usual Rhode Island horror story about an old truck with a huge vehicle excise tax bill – he has 20 such stories to go with his fleet of trucks. More

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GOVERNMENT

Car-tax hikes leave owners fuming

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Overhead Door Garage Headquarters President Scott Grace has more than the usual Rhode Island horror story about an old truck with a huge vehicle excise tax bill – he has 20 such stories to go with his fleet of trucks.

Complaints about the size of motor-vehicle excise tax bills in the state are nothing new, but since lawmakers facing a budget crisis last year allowed cities and towns to lower the standard $6,000 vehicle tax exemption, grumbling has turned to outrage.

Now, spurred by angry constituents and business groups, a number of state and local officials have come out in support of changing the law that spells out how vehicles in the state are valued for tax purposes.

Grace’s Warwick-based company, which sells and installs garage doors throughout the Northeast, relies on those trucks to get employees and materials to job sites throughout the region.

But when Grace receives his vehicle tax bills each year, the 2004 GMC truck parked in Warwick costs about four times more in tax than a similar truck parked at Overhead Door’s Norwood, Mass., office.

In this year alone, the tax bill for each Rhode Island truck rose 30 percent, Grace said.

So as the company expands and hires more workers, Grace said those added tax costs are making him consider moving operations across the border to Massachusetts or Connecticut.

“It is pretty eye-opening the spread between what we are paying in Rhode Island versus Massachusetts,” Grace said. “We have some decisions to make about where we put some resources in the future, about where we hire people. This is a contributing factor.”

Rep. Joseph McNamara, D-Warwick, has pre-filed a bill for next year’s legislative session that would require the age and condition of a vehicle to be taken into account in determining its value.

“This is a very difficult, regressive tax. What we want to do is give people a more accurate assessment,” he said.

McNamara’s hometown of Warwick has been a hotbed of car-tax discontent this year after the city, facing an $11 million budget gap, cut its vehicle tax exemption from $6,000 all the way to the $500 minimum.

The change meant that residents and businesses with old clunkers worth less than $6,000, who previously had never received a tax bill for those vehicles, were charged for the first time while the owners of cars already over the limit saw their bills skyrocket.

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Small Business

Massachusetts has a declining valuation until a vehicle reaches a five year limit. So, if after five years, your vehicle is worth $5,000, you are taxed at the $5,000 level for as long as you keep the car on the road.

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