Local News

Proposed Bill Would Help Improve Vehicle Tax Collection Rates

Posted August 2, 2005

— An effort under way in the General Assembly aims to change the way car owners pay their county vehicle tax.

Last year, Wake County lost $4 million in unpaid vehicle taxes. Durham and Harnett counties each missed out on more than $1 million, while Johnston County is still waiting for $800,000 in payments.

Some state lawmakers think they found a way to improve collection rates by requiring car owners to pay the tax when they renew their license tag.

"People renew their plates and then three months later they get a motor vehicle bill from us and by then, some people have moved," said tax administrator Pat Goddard. "We get a lot of returned mail. It's a difficult class to collect."

It is so difficult that in Johnston County, 10 percent of the tax bills on cars went uncollected last year. Tax officials said that was a good year.

Under the proposed bill, car owners would be sent a renewal form that can be paid on the Internet or to a tag agent.

"There won't be anymore mailings. You'll do it once and you'll be done," said Rep. Dale Folwess, R-Forsyth County.

For counties, it would add up to $80 million statewide in unpaid taxes that could finally be used for services. For the state, it would save millions of dollars on postage alone.

"When I said that there's five mailings that go out, that happens over 7 million times in North Carolina, so you can do the math," Folwell said.

County tax collectors say it adds up to efficiency all around.

"I think that we'll go from 90 percent collected to 100 percent collected," Goddard said. "And I think it streamlines government. I think it's a great idea."

There is a potential roadblock for this bill. It all hinges on the cost of linking the Division of Motor Vehicle's computer system, with all 100 counties. If the bill is passed, the new system could be in place in up to four years.


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