Barren County Clerk Helena Birdwell holds a motor taxation notice, which is sent to vehicle owners during their birth month. The most recent property valuations for motor vehicles were estimated at 40% more than last year.
(BRENNAN CRAIN/WCLU NEWS)
GLASGOW — Motor vehicle valuation reportedly saw a 40% hike this year, and state lawmakers are working to pass legislation that could give some Kentuckians a partial refund on the amount they paid toward state motor taxes.
House Bill 6 was introduced as a measure to set guidelines for valuation and to refund a portion of the state tax back to those who’ve paid it this year. The motor tax is commonly described on a small piece of cardstock which makes its way to mailboxes during the registered owner’s birth month.
“For the taxpayers, this has hit home really hard for so many people,” said Barren County Clerk Helena Birdwell.
The Barren County Clerk’s Office isn’t certain about the process they will use to refund some of the 2022 tax bills already paid. That guidance is expected to be handed down by state officials in Frankfort.
Another aspect of the bill seeks to hold the Kentucky Department of Revenue to a standard when it comes to attaching a value to motor property. The current valuation is derived from J.D. Power, which is a data analytics company. Current valuations use the “clean value,” which has a higher price tag than the average or even lower “rough value.”
The drastic valuation hike took its toll on 2022 motor property values, which means the total tax bills sent to Kentuckians increased alongside selling amounts.
The Barren County Clerk’s Office reports customers are selling their vehicles for higher prices, too. Some relish the fact vehicles are selling at higher prices than they purchased them for as recently as two years ago.
“So, we know the price is elevated currently,” Birdwell said.
Birdwell said while 2021 valuations were up, they were much higher this year. Vehicle production took a major hit at the beginning of the pandemic because autoworkers were laid off or couldn’t work due to restrictions, and it led to higher valuation — especially among used vehicles.
And while the county and local taxes were also higher as a result of the increased valuation, the new legislation seeks to only refund a portion of the state tax collected. Uncertainty remains regarding refund amounts for taxes aside from the state collections.
“We don’t know yet,” Birdwell said.
The clerk speculated a system outage will likely happen if the bill passes and the state decided to refund portions of those collections. A message to the clerk said the outage could be up to two days. Refunds must be provided within 90 days of the legislation’s passage, according to language in the bill.
View an unofficial copy of that bill here.
