Dealerships say the Vehicle Privilege Tax may cost customers more

One of the taxes in the newly implemented House Bill 2017 affects dealerships and those buying from them.

Posted: Jan 2, 2018 5:06 PM

ROSEBURG, Ore. - On January 1 all taxes stemming from the House Bill 2017 went into action, one of those being the Vehicle Privilege Act, which taxes the privilege to sell vehicles in Oregon.

A 0.5% tax is now due on the retail price of any new taxable vehicle, and dealerships aren't happy about it.

One owner of a dealership in Roseburg, Clint Newell of the Clint Newell Auto Group, said he's unhappy because of the nature of it, but he doesn't see it affecting business. He said it will be an issue for consumers in the long run, because they'll be the ones paying it due to a price increase.

And since the consumers are affected, he felt it wasn't right that they didn't get more of a say in the matter.

”They’re basically creating a sales tax without a vote, and I have a problem with that. If we’re going to do this I think it’s something that the public should at least have a say in rather than the state just dictating it to us," said Newell.

Newell said the money from this tax goes into a fund to distribute rebates to those who purchase electric cars. He said the state is trying to manipulate the market by providing incentives, and in his experience efforts like that haven't worked out.

He said what's scary to him about the tax is that it may get raised over time, especially if it's not getting the results expected.

”The fear is that they’ll raise it in the future, and this is the foot in the door to generate larger and larger sales taxes down the road. I think that’s what most people are fearful of," Newell said. 

The larger goal of the House Bill 2017 is to provide transportation and infrastructure updates throughout the state of Oregon.

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