Why you could pay more to renew your car tag this year

Published: Feb. 2, 2022 at 9:28 AM CST|Updated: Feb. 2, 2022 at 1:53 PM CST
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BIRMINGHAM, Ala. (WBRC) - This year’s trip to the DMV to renew your tag may cost a bit more.

It’s because you may have to pay more in taxes; another issue to blame on the pandemic.

Some people said they paid as much as 20% more to renew their car tag in 2022.

“Property taxes make up a large part of what taxpayers pay. Property taxes are based on a vehicle’s fair market value as of October 1 of the prior year. Due to the recent growth in demand for used vehicles, some market values have increased, resulting in an equivalent increase in taxes,” the Alabama Department of Revenue said in a statement.

“Of all the years that I have worked in the automotive industry, I’ve never seen such a crazy time,” Mike Quincy with Consumer Reports said.

Quincy said there was a reason all cars, used and new, are so expensive right now.

“A combination of inflation, there’s parts shortages, still a shortage of semiconductors. The economy is slowly recovering,” Quincy explained.

Low supply equals higher prices.

The ADR said not everyone will see higher property taxes in 2022 because not all vehicles have seen an increase in market value.

ADR also said if market values decrease in future years, taxpayers will see that decrease reflected in future tag renewals.


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