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Monday, June 14, 2010

Hassett to Propose No Increase in Motor Vehicle Taxes

Council Leader calls any increase unfair to struggling residents 

While the General Assembly has given cities and towns the authority to generate more tax revenue from automobiles, City Council Majority Leader Terrence M. Hassett, D-Ward 12, will propose “no change” in the manner the city derives taxes from automobiles, the City Council office announced.

Under a measure approved by the general assembly, cities and towns were granted approval to tax motor vehicles in the respective municipalities at full value. Current law exempts the first $6,000 in valuation with the state reimbursing local governments for the difference. Hassett said he will move to block any increase, thus, keeping the arrangement the same. Providence’s motor vehicle excise tax rate is $76.78 per one thousand of valuation, with the first $6,000 exempt.

“City government will have to cut expenditures,” he said. The state has reduced the reimbursement for the exempted value, leaving the city to make up for the shortfall through an increase in residents’ tax bills. The Council Committee on Finance is insisting on across the board cuts that will offset the lost revenue from the car tax.

As to how we are going to achieve the savings, Councilman John J. Igliozzi, Chairman of the Council Committee on Finance stated that he will “challenge every City Department to cut their budget by 10%. However, because of the revaluation, there will be minor adjustments to the real estate tax rate.”

“This would help struggling families who have an older car avoid paying this car tax,” Hassett said. We have to stop grinding taxpayers with these onerous taxes. This is already a miserable tax. I am not going to make it worse by passing on the state’s cuts to Providence.”