The Dualing Motor Vehicle License Tax Confusion Somewhat Clearly Explained

Published 4:30 pm Tuesday, October 19, 2010

Farmville residents living in Cumberland and Prince Edward Counties shouldn't feel bad if they get confused about the new dual motor vehicle licensing tax rates for town residents. It could happen to anyone. And has already done so.

The Town has stopped selling its vehicle decals-most folks paid $25 per vehicle, if they purchased a decal-and is having the Counties of Cumberland and Prince Edward collect the money for them. The Town still wanted the motor vehicle tax revenue but didn't want to have to keep trying to convince people to buy the decals and, for those who did buy them, scrape the old ones off their windshield each year.

One of the potentially confusing things is that Farmville residents in Cumberland and Prince Edward will pay different amounts, taxed differently, even though they all live in Farmville, because Cumberland's rate is lower than Farmville's had been and Prince Edward's is about 25 percent higher, which is an increase of approximately $6.25, making it now a $31.25 Motor Vehicle Tax fee for Farmville residents in Prince Edward.

Email newsletter signup

The second potentially confusing thing is that Farmville residents in Cumberland and Prince Edward will begin paying the new motor vehicle license tax rates as part of those respective Counties' personal property tax bills. Cumberland and Prince Edward are sending them out with the personal property tax bills, but the motor vehicle license tax is separate and distinct from the personal property tax on vehicles.

So, in Cumberland, town residents won't see their personal property tax rate go down, but will see the motor vehicle license tax reduced to the County's rate.

And in Prince Edward, Farmville residents will not see their personal property tax bill go up 25 percent because of this deal. No, it is their motor vehicle license tax rate that is rising 25 percent.

The Town of Farmville is paying Cumberland and Prince Edward County a collection, or administration, fee of 10 percent of the funds generated by the motor vehicle license tax revenue generated within the Town.

Prince Edward County has a pretty peachy deal because in addition to the 10 percent administration, or collection, fee the County will also keep the entire extra 25 percent generated because its rate is 25 percent higher than Farmville's old rate. That's the deal agreed to by the Town, which no longer has to pay for the production of Town decals that hardly anyone purchased.

The Town will also come out ahead because its motor vehicle license tax fees will increase significantly, with everyone getting a bill for the tax instead of the old method which required people to come to the Town Treasurer's office and buy a vehicle decal. Again, most people stopped volunteering to do so some years ago.

So, there is the fairly clear explanation, in case there had been any confusion, of which there is probably plenty now.

-JKW-