CLAYTON The tax break is over for St. LouisCounty residents who own certain makes of large pickups and sportutility vehicles.
Because of an unusual rise in market values of those vehicles,many county residents will pay higher personal property taxes thisyear.
In that regard, they have plenty of company.
Last year, officials across the nation, including in the city ofSt. Louis and St. Charles County, began raising assessments ” andthus, taxes ” on many used vehicles.
However, St. Louis County’s director of revenue, Eugene Leung,disregarded the official market increases last year.
“Cars don’t appreciate,” Leung said at the time.
Since then, the county has elected an assessor, Jake Zimmerman,who has chosen to follow the national trend.
“What Gene (Leung) said last year may have seemed reasonable atthe time, that these values don’t go up,” Zimmerman said Thursday.”But having seen it two years in a row, the conclusion is that thefair market value of these bigger vehicles really is going up. Andin light of that, I reversed the decision made last year.”
Zimmerman said that the State Tax Commission has instructedcounty assessors across Missouri to use market values as set by theNational Automobile Dealers Association (NADA).
Jonathan Banks, an analyst for NADA, said vehicles such asTahoes, Sequoias, Grand Cherokees and Ford F150s that are one to 5years old have risen in price about 10 percent since last year. Andthat, he said, was on top of a 25 percent boost in the market valueof those vehicles from 2009 to 2010.
Banks cited a combination of factors for the spike in values onthe large pickups and SUVs: a sharp reduction in production of bigvehicles in response to rising gas prices; the federal Cash forClunkers stimulus program, which scrapped old cars in exchange fordeals on new ones; and the recession, which led to a decrease innew car sales.
“The economy is not good, so when people have to replace avehicle, they don’t feel comfortable buying a new one,” Banks said.”This creates a higher demand for used vehicles, but meanwhile, theused supply is down because sales of new cars have been droppingoff for years.”
He said the average age of vehicles on the road is about 11years. “That is about two years older than the historic average,”he said.
Yari Lindo of Rock Hill drives a big SUV, a 2008 Nissan Armada.He paid about $660 in personal property taxes on it last year.
This year, the county raised the assessment on the vehicle byabout 18 percent. (The taxes Lindo owes this year will not be setuntil later this month.)
“One of the breaks I always figured I could count on was adepreciation on my vehicle,” Lindo said. “I don’t see how they canjustify that increase. With gas hovering around $3 a gallon, Iwouldn’t think that SUVs would be in high demand right now.”
Zimmerman encouraged residents to call his office if they thinkthe county got the values wrong.
“If you think the true value of your car is not what the NADAguidebook says ” if it has high mileage or is a beat-up piece ofjunk ” you gotta let us know, because there are mechanisms forappeal,” he said.
Meanwhile, Banks, the NADA analyst, said there is an upside tothe trend.
“With the new-car market down, dealers are putting a greateremphasis on selling used cars,” he said. “This means that your usedcar has a lot more equity in it if you want to trade it in on a newone.”
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