2000 Legislative Referendum
The tax imposed when a vehicle is sold or transferred also was changed. For new vehicles, the tax will be 3.25% of the actual sales price. For used vehicles, the excise tax will be $20 for the first $1,000 for FY 01, plus 3.25% of the remainder of the actual sales price. The $1,000 figure is increased to $1,250 for FY 02 and to $1,500 for FY 03 and thereafter. The measure will become effective October 1, 2000.
State Question 691 was referred to the voters by the Legislature in the 2000 session. Originally, these provisions were enacted in HB 2663, authored by Senator Jim Maddox and Representative Ron Kirby. After the Governor vetoed HB 2663, the Legislature enacted HB 2189, authored by President Pro Tempore Stratton Taylor and Speaker Loyd Benson. HB 2189 was almost identical to HB 2663, but it referred the provisions to a vote of the people at the August 22, 2000, primary election.
State Question 691 will result in decreased revenue collections from license tag fees and increased revenue collections from excise taxes. The amount of the decrease will be greater than the amount of the increase, resulting in a net tax cut. No individual vehicle owner will pay more for a tag under State Question 691, but vehicle purchasers may pay more or less excise tax than under the current system depending upon the circumstances of the transaction. For that portion of FY 01 during which the measure will be effective, the net decrease in collections will be $8.7 million. For FY 02, the net decrease will be $17.0 million, and for FY 03 and thereafter, the net decrease will be $22.3 million.
Cost of Motor Vehicle Tags
The fees for commercial tags are based on vehicle weight, rather than vehicle price. They range from $95 (15,000 pounds and less) to $1,078 (89,001 to 90,000 pounds) (see Sections 1133 and 1133.1 of Title 47 of the Oklahoma Statutes). To be registered as a commercial vehicle, a vehicle must be a truck or station wagon, be used primarily for business or commercial purposes, and be labeled with either the name of the business or the words "commercial vehicle". The fee for registration of a pickup, truck or truck-tractor used primarily for farm use is $30 (see Section 1134 of Title 47 of the Oklahoma Statutes).
All motor vehicle registration fees are in lieu of property taxes on vehicles in Oklahoma. In most states, although a tag fee may be imposed, property taxes are due annually on the value of vehicles.
Over time, registration fees for noncommercial vehicles have increased in Oklahoma, since they have been based on vehicle value, while commercial and farm tag fees have not. When the Oklahoma Vehicle License and Registration Act (Section 1101 et seq. of Title 47 of the Oklahoma Statutes) was enacted in 1985, the average commercial vehicle fee was higher than the average noncommercial vehicle fee. By 1997, the lines had crossed; noncommercial vehicles were, on average, more expensive to tag than commercial vehicles.
Oklahomans have used several different means to evade the cost of noncommercial motor vehicle tags (some of which are legal and others of which are not). Some owners of station wagons, including sport utility vehicles and vans, and pickup trucks, choose to register their vehicles as commercial vehicles. In 1986, 149,370 vehicles were registered as commercial vehicles, while 2,524,519 vehicles were registered as noncommercial vehicles. By 1999, the number of noncommercial vehicles had fallen slightly, to 2,423,227, and the number of commercial vehicles had risen 52%, to 226,323. During this time period, several Indian tribes began issuing their own tags to tribal members. Some Oklahomans have illegally tagged their vehicles in other states.
Vehicle Excise Taxes
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