Franklin approves discounted car taxes in wake of surging vehicle values
Published 9:47 pm Tuesday, June 14, 2022
The city of Franklin has found a means of providing car tax relief to motorists in light of a sharp nationwide rise in used vehicle values.
Rather than reduce its tax rate of $4.50 per $100 of a vehicle’s assessed value, Franklin’s City Council voted unanimously June 13 to approve a one-time discount in the city’s car tax calculations — one which will factor in only 75% of a vehicle’s trade-in value rather than the 100% used in prior years.
According to City Manager Amanda Jarratt, Franklin saw a 19% increase in vehicle valuations during 2021, and is currently on track to see an increase of 25% for 2022 due to a “limited market of vehicles” spurred by the COVID-19 pandemic.
A 2020 Dodge Ram 1500 pickup truck purchased for $24,682, for example, had an assessed value of $34,150 in 2021 according to data Franklin’s commissioner of the revenue, Selenia Boone, provided. It’s 2022 value, prior to the council’s vote, was on track to rise to $41,450.
According to Jarratt, Franklin’s anticipated surge in car tax revenue isn’t being driven solely by inflation in the used vehicle market, but also by an “influx of new vehicles into the city.” Just over 160 vehicles on the city’s books still depreciated despite the inflation, she said.
With the one-time discounted valuation process, “there’s a lot of vehicles that will pay way less than they paid last year because of this methodology,” Jarratt said.
Southampton County, by comparison, has proposed lowering its car tax rate from $5 per $100 to $4.60. Neighboring Isle of Wight County’s supervisors voted in March to reduce its car tax from $4.50 per $100 to $3.90.
According to Gerald Gwaltney, Isle of Wight’s commissioner of the revenue, the nationwide drop in new and used vehicle inventories is being spurred by the continued economic impacts of the COVID-19 pandemic and a shortage of the computer chips needed to run newer cars.