HARTFORD, Conn. (WFSB) – The I-Team has been looking into complaints about Connecticut’s new car tax system. A new law about how to calculate car taxes went into effect this year.
After our reporting, multiple electric vehicle owners reached out to the I-Team to say they are getting a bad deal, including Dave Lowe in Meriden. Lowe was excited to purchase his electric 2024 Chevy Blazer last year.
“We said hey, it’s a good time to buy it. There were some great incentives on buying it, and you’re doing something to help with the whole environment, fossil fuel issue,” said Lowe.
His excitement faded when he opened his mailbox this summer and got the car’s first tax bill.
“The bill for this car was $1,059,” said Lowe.
This is the first year Connecticut car taxes are based on a car’s MSRP, manufacturer’s suggested retail price. Lowe did the math and based on his bill, the town of Meriden is using an MSRP of more than $54,000 for his Blazer, but that’s not what he paid.
“Our actual cost was $33,300 after all of the federal, state, manufacturer discount, dealer discount,” said Lowe.
In Glastonbury, the new MSRP system is valuing Joe Querido’s 2017 Nissan leaf at around $18,000. He bought it used two years ago for only $8,000. He thinks if he sold it today it’d be worth a maximum of $4,500 because the battery loses mileage over time.
“When this car was brand new, I could give it maybe 120 miles, but now on a good day I can probably get 70. That brings the value down a lot too,” said Querido.
The I-Team has also heard from 2 Tesla owners, and they report the same thing: their valuation is thousands of dollars higher than what they believe their car is worth, and their car tax bills have more than doubled this year.
Now car taxes are calculated based off a car’s MSRP, and there’s a set depreciation schedule no matter the make or model. However, iSeeCars, which collects data from used car listings across the country, reports electric vehicles depreciate faster than any other type of vehicle. The overall 5-year depreciation average for all cars is 45.6% . For electric vehicles, the average 5-year depreciation is 58.8%. That difference would have been accounted for in the way car taxes used to be calculated, when something like the Kelly Blue Book value was used. However, the new MSRP method treats all cars the same and also does not account for all the electric vehicle rebates. Almost no EV owner pays the MSRP.
“It’s an interesting public policy situation because we want to encourage people to buy electric vehicles. It’s good for the environment. We’re giving them incentives, but we have a tax system which in my humble opinion is flawed that is now charging you way too much, so you’ve wiped out an incentive with a disincentive,” said Lowe.
David Lowe reached out to his state representative Michael Quinn, a democrat. Quinn voted for the bill in 2022 that ultimately led to this change in the way car taxes are calculated. He said the idea was to make your car taxes more predictable after used car prices spiked during the pandemic, but he admits he hadn’t thought of how this would impact electric vehicles until Lowe reached out.
“I don’t know that that was taken into consideration the way that it should have been,” said Quinn.
Quinn says the legislature should look into this and would like to see an even bigger change.
“Probably the ultimate solution is to just get rid of the car tax altogether, but then you have the problem of how do you come up with the revenue to supplant what you’ve just taken away by getting rid of the car tax?” said Quinn.
Republican state senator Jeff Gordon is a ranking member on the committee on planning and development, the committee where most car tax-related bills start. Gordon wasn’t in the legislature in 2022 when this bill originally passed and thinks there should have been more scrutiny.
“These are unintended consequences of something that was trying to be put through when there really should have been more time to think it through,” said Gordon.
Gordon would like to look into this electric vehicle issue next legislative session and agrees with Quinn that they have to consider how any change will impact the towns that collect the car taxes.
“We got to really look at that and see if people are now being over-taxed, and if that’s the case, then we should look at changes, but we also don’t want to be hurting the municipalities and the grand lists,” said Gordon.
As the law stands now, both Lowe and Querido are reconsidering whether going electric is worth it.
The I-Team asked both men, would you buy another electric vehicle in Connecticut?
“Probably not in Connecticut,” said Querido.
“We might have thought twice about it if we had known that we would have to pay these kinds of taxes,” said Lowe.
Both Querido and Lowe also believe the MSRP their towns used were too high to begin with. That’s something state law allows you to appeal. Both men are planning to go through their town’s appeal process.
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