With tones all but dripping with disgust, stern voices responding to recent reporting on the deployment of farm use vehicle license tags condemned a subset of so-licensed drivers as tax scofflaws and called for stepped up law enforcement to stop them.
Who were these angry callers? Commissioners of the revenue? General Assembly tax collection hawks? Traffic cops?
No sir. These were citizens peeved the tax man was not getting his fair share.
Ed Fox of Daleville’s remarks were a good reflection of the sentiment.
Q: Why don’t you do an article on those who are using antique tags? I see a lot of those tags on cars that may be 20 years old but are no antiques. We know why they do it.
Dale Dewease was clearly making an effort to remain composed.
“I am fed up with these people using farm use tags and the law not being enforced,” he said in a telephone message.
Requirements for licensing farm and antique vehicles are detailed in the Code of Virginia. Information about farm vehicles was covered in the previous column (read it at https://bit.ly/3D8FKnB). Antique vehicles and trailers are defined at § 46.2-100 as those of model year 25 years prior to the current January and “is owned solely as a collector’s item.”
Continuing to § 46.2-730, which covers licensing for antiques, the law goes into the process for applying for antique vehicle tags and the notarized form that goes with it. A key restriction of the law is that cars so-licensed may not be used for general transportation including “daily travel to and from the owner’s place of employment.”
Exemptions allowing for use of the vehicle for general transportation are covered in § 46.2-730 Section F. Should none of the exemptions apply, it is assumed the vehicle is subject to restricted use.
An email request for comment from Virginia State Police was met with an out of office email response from a local spokesman. A state level spokesperson did not respond by press time. We’ll report when they do.
Meanwhile, in response to the earlier column, Ron Melancon of Richmond mounted a three-prong verbal assault on the not so artful tax dodgers who sport Montana tags as well as drivers who cheat with farm and antique tags.
The critic appeared to have nothing against the Big Sky State or its drivers, just those motorists from elsewhere who license what he termed their “exotic” cars in Montana in order to take advantage of a generous local tax code.
“The biggest scam going,” he said referring to all three categories of four-wheeled tax evaders.
As for those who sport Montana plates on their Bugatti but have a mailing address 1,000 miles from Bozeman, Doug DeMuro explained how the dodge works in a 2013 blog post at The Truth About Cars site.
First, he offered a caveat to his explanation for an abundance of pricey rides with Montana plates by predicting his views will alienate “the wealthy exotic car owner and Montana attorney readership, but perhaps gain a following among county tax commissioners.”
Montana has no sales tax. DeMuro glibly posited that is a tacit admission the state has all the money it needs “which possibly explains why they went without speed limits for several years: they couldn’t afford the signs.”
Remember the Bugatti? Note the publication date as the reporter uses a Veyron model and the Georgia tax code for an example. The manufacturer’s suggested price for a Veyron is a modest $1.7 million, taxed at Georgia’s rate of 7% amounting to a bill for $119,000.
If the car were owned in Montana, there would be no sales tax, the cost to put the car on the road is thus limited to a few dollars for licensing and related fees. In sum, big savings from what the whole transaction woulad cost in the less-than-peachy state for tax purposes on the other side of the country.
The question for the out of state fancy car owner and tax loather is how to put Montana tags on a car to be driven nowhere near where the buffalo roam. DeMuro says it’s easy, so we’ll assume it still is.
The first step is to hire a Montana lawyer who can set up a limited liability corporation for you there that uses the attorney as your registered agent. That done, the Bugatti is declared as property of your newly formed LLC.
Assuming an upfront fee of about $1,000 to set up the corporation, a $100 annual retainer for the lawyer (the reporter calls these yearly expenses “hush money so they don’t rat you out to your DMV”), and annual registration fee from Montana, presto, you’ve saved a bundle.
Those who pilot cheaper rides than a Bugatti can employ the same strategy.
DeMuro posed the obvious follow-up query. So why doesn’t everybody who knows about such a strategy do it? Answering his own question, he called the dodge “risky” and “frankly, a bit morally questionable.”
Just a bit.
The threat to the scofflaw is that somebody will notice a local driving a high-dollar chariot nowhere near Little Bighorn. In addition to routine police traffic stops, added perils include programs in various states encouraging citizens to report tax evaders.
Even if you get by with it for a while, if you’re caught, the subsequently retroactive tax bill could be of grotesque proportion. Never underestimate the possibility for jail time on tax evasion charges, either.
If you’ve been wondering about something, call “What’s on Your Mind?” at 777-6476 or send an email to firstname.lastname@example.org. Don’t forget to provide your full name (and its proper spelling if by phone) and hometown.