Motorists who lease cars after March 1 would pay an upfront title tax but not a monthly fee as part of their payments under legislation approved by the state House on Thursday.
House Bill 80, sponsored by Rep. Tom Rice, R-Norcross, passed the House 159-4. It tweaks the state’s car tax laws in an attempt to clean-up changes made in last year’s sweeping tax reform bill.
That bill eliminates the state’s “birthday tax,” the annual property tax Georgians paid on their cars. Beginning March 1, Georgians will pay an upfront title tax of 6.5 percent of the market value of the car.
As originally written, HB 80 would have added the title tax to car leases, too. But the bill left in place the monthly use tax paid as part of monthly lease payments. The bill has since been amended to eliminate the monthly fee.
The title tax will rise to 7 percent in 2015.
“We thought that was a good change,” Rice said.
More than 30 percent of car transactions in Georgia are leases, nearly twice the national average.