[Berzerker]

Originally Posted by jimbethesda

I'm going to pile on the anti-politican thought here, but from a different angle.

CA's approach is actually better in some ways. In most states, the sales tax benefit when trading in benefits dealers the most (who donate A LOT of money to politicians and hold a lot of power over local governments). Let's say your current car is worth $40,000 as a trade in, but $45,000 if you sold it on your own. If you trade it in, you'd save $2,500 in sales tax (in TX). Instead of a $5,000 difference, now it's only $2,500. You're much more likely to trade it in now. The dealer can sell it for $50,000 because most people are more comfortable buying from a dealer instead of an individual.

CA, while in some ways worse, at least levels the playing field. Better, of course, would be that you can recoup the sales tax if you sold one car and bought another one within a few months.

This whole sales tax savings thing sounds great, it's really an example of lobbyists crafting laws to benefit them. We don't complain, because it seems good to us, but I'd prefer no sales tax benefit when trading in, but lower property taxes or lower sales taxes overall.

Just my $.02

As always, things should be taxed in a way that benefits those with lower income. These kinds of rules aren't useful when looked at in a vacuum, and need to be analyzed with the entire process.

[jimbethesda]

Originally Posted by Berzerker

As always, things should be taxed in a way that benefits those with lower income. These kinds of rules aren't useful when looked at in a vacuum, and need to be analyzed with the entire process.

Yeah, and taxes largely do that all ready. Even at the same rates, the wealthy pay more (their property is worth more, they earn and spend more). Income tax rates are also higher at higher income, so you get the double whammy.

My point still stands, that this sales tax benefit when trading in is all about lobbyists and not a piece of well thought out tax policy.

[Needsdecaf]

Originally Posted by mcsquared

That, ummmm…, blows!

You think that sucks? In Texas when you lease, you pay sakes tax on the full purchase price Not just the portion you lease. When I first moved here I was looking at assuming a lease for 12-18 months until I found out that little tidbit.

[mcsquared]

Originally Posted by Needsdecaf

You think that sucks? In Texas when you lease, you pay sakes tax on the full purchase price Not just the portion you lease. When I first moved here I was looking at assuming a lease for 12-18 months until I found out that little tidbit.

Terrible. It’s bad enough you gotta pay taxes on an already taxed (used) vehicle that was new. I don’t typically lease cars, but, man, that sucks! I don’t know the FL rules for leases, but, the finance on a new car/trade in is as explained in the beginning of the thread.

Good ole Uncle Sam and his greedy pockets!