When you buy a used old car in our state, the gov’ment expects you to pay sales tax on the “true value” of the car, not what you actually paid. And to determine said value, they use those soft-bound NADA value guides that are about as accurate as my estimates on how long it will take me to restore my E-Type (i.e., very inaccurate).
For example, when I bought the XJR, I paid $7,400. I had to pay sales tax on $13,500, even though the price I paid was exactly the market price! I’m having a difficult time getting anyone interested in my XJ6 for $1,800, yet the price guides say it’s worth $5,000.
And there is no easy recourse. You can get the seller to write you a note, which the state doesn’t have to accept, but by that point the seller frankly never wants to see you again and isn’t going to write a notarized letter. State wins, more money for them. Who would have thought?
Another bad thing about these guides is that it suckers sellers into asking way too much for their cars, and then they never get a buyer. An example: using a price guide (mentioned in their ad, no less), a seller on craigslist has a car worth–maybe–$1,000 priced at $12,000 because the guides say it’s worth that. I can tell you that not a single car of that model has sold for that amount, even in pristine condition–ever!
I’m a pretty liberal guy who believes in good government, but I hate hidden taxes and that is exactly what this is. Bah!
I agree that this is very bad. Perhaps Mr. Anti-Tax will write an initiative. :)
I do not seem to get nearly as disgruntled on this subject as you do. Maybe it is because I only have one car. And I keep the same car for multiple years. ;)
Eyman is a client of ours (ask me to relate a funny story about that sometime)… want me to talk to him about this? ;)
Chuck, that’s funny. I actually agree with the guy who thought (thinks?) Eyman is a horses’ ass, so I expect probably not.
I suspect those guides are probably more accurate for newer, more pedestrian, cars and it’s only weirdos like me who end up on the short end of the stick.