CA Bill To Cut Sales-Tax, License Fees On Electric, Alt-Fuel CarsCA Bill To Cut Sales-Tax, License Fees On Electric, Alt-Fuel Cars

Today, electric cars and other vehicles that run on alternative fuels simply cost more. That’s a fact.
Now a new bill introduced in the California Assembly aims to trim a bit more off the costs of buying and registering these cars by reducing their assessed value.
The brainchild of Assemblyman Al Muratsuchi, who unveiled it Friday in Hermosa Beach, the bill (AB 1077) uses existing incentives to reduce the tax basis of more expensive alt-fuel vehicles.
In California, for instance, plug-in electric cars like the Nissan Leaf and Tesla Model S qualify for both a Federal income-tax credit of $7,500 and a state purchase rebate of $2,500.
Muratsuchi’s bill deducts those amounts from the legal assessed value of the car when it is purchased new, reducing the amount on which sales tax must be paid.
It also cuts the car’s value for purposes of calculating the registration fee levied by California for a new set of license-plate tags every year.
Take, for instance, the 2013 Nissan Leaf. The base trim level, the Leaf S, starts at $28,800 before delivery fees, options, and so forth.
But let’s say a buyer chooses a mid-level Leaf SV that ends up selling for a cash price of around $33,000.
Muratsuchi’s bill reduces the sales tax due from the buyer to the amount that would be required on a $23,000 car.
At a rate of 8 percent, that would be a saving of $800–not insignificant.
The small surfing town of Hermosa Beach, south of Los Angeles International Airport, already has four electric-vehicle charging stations.
Two are located at the town’s City Hall, where Muratsuchi held his press conference in front of a variety of electric cars, including a Nissan Leaf, a Tesla Model S, and a Tesla Roadster.
Muratsuchi noted that his bill is supported by electric-car advocates like the California Electric Transportation Coalition and Plug-In America; environmental groups like the Natural Resources Defense Council; utilities like Southern California Edison; and automakers that include General Motors, Honda, and Nissan.
AB 1077 would also apply to vehicles that run on natural gas and various other alternative fuels, though its largest effect will be to reduce costs for the tens of thousands of California buyers expected to purchase plug-in electric vehicles in coming years.
If enacted into law, the bill would take effect on January 1, 2014.
It must still be passed not only by the California Assembly, but also the state Senate.
[hat tip: Doug Martoccia]
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