Collector car tax

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jcwconsult
Posts: 128
Joined: Wed Jun 02, 2004 11:55 am
Location: Ann Arbor, Michigan

Collector car tax

Post by jcwconsult »

I have NO idea if this is true, but if it is - we have a problem.


Senator Schumer proposes 10% annual tax on collector cars
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Senator Eyes Collector Cars as Revenue Source
New York Times article Mar.28, 2011

Auto Enthusiasts who dodge taxes are in Schumer's crosshairs

Washington, D.C. - AP. Senator Charles Schumer (D-NY) held a press conference today in the Capitol's rotunda and stated that he is in the process of drafting a bill that will create a federal tax on all collector, antique, historic, special interest, hot rods and race cars. "This country is operating at a huge budget deficit," said Senator Schumer, "thanks to the previous administration's failure to seek new sources of revenue.

We can no longer continue to just raise the taxes we already have. We are reaching the point of diminishing returns. We must find new sources of revenue. "There are more than one million collector cars in this country,"said Schumer, "and many of them are unregistered and untaxed. These vehicles represent sometimes sizeable assets which often appreciate from sale to sale. Much of these capital gains remain untaxed . It's about time these collectors—all of whom are rich—begin to pay their fair share. I've never heard of a poor person owning a Corvette, Ferrari, Deusenberg or Cobra." Citing the results of this year's automobile auctions in Scottsdale, Arizona as an example,where reported sales were in the tens of millions of dollars, Schumer said, "We're not talking about rusty old clunkers, here.

Some of these cars represent the pinnacle of automotive history. Collectors who buy and sell them often do so privately. Some transactions are in cash and others include trades. All of these are under the Internal Revenue Service's radar. Well, that will soon end."Each state has different laws and requirements for collector cars. Those which tax them as personal property often use outdated values. An owner can pay taxes on a car the state determines is worth $5,000 and then turn around and sell it for $100,000 or more. Until now, all of this has been the purview of each state. Schumer's law will sidestep all state laws by levying a federal tax in addition to anything the individual states do.

This new federal tax will be similar to the present federal tax on gasoline, which is in addition to whatever a state assesses. Part of the Schumer law includes the IRS opening up a special department to deal with collector cars. Values will be calculated annually and owners will be required to list all cars they own on their 1040 tax form. Because not all vehicles are registered, and thus may not be known to the individual states' motor vehicles departments—especially race cars which are not driven on public roads—the IRS will make use of the existing network of individual collector car enthusiast organizations across the country. Many of these car clubs maintain accurate registries which detail each car by its vehicle identification number and present or last known owner and their location. Assembling an all-inclusive federal database in conjunction with these registries will be one of the first steps in implementing the new law.

Once the database of owners is cross-referenced with an annual index of current collector car values, every collector or race car in the country can be taxed at a fair rate. Initially, Schumer says, it will be 10% but that would rise depending on the type of car, number produced and condition. "Collectors are willing to pay more for certain cars," said Schumer, "because of their history or the small number that were produced. These factors increase a vehicle's worth to buyers, so why should these cars not be taxed at a higher rate? It's no different than our current progressive income tax rate." It is estimated that an annual 10% tax on all collector cars presently owned by American taxpayers—at their prevailing market value—would be more than $250,000,000.

In four years the coffers of the federal government could be fattened by a billion dollars. "That's only a conservative estimate," said Schumer. "Nobody knows exactly how many collector cars are out there. But by this time next year, WE will know. Owners of these cars will finally have to pay up.Their free ride—on the backs of the poor—is over."
Jim Walker
365 GT 2+2 #12451
jcwconsult
Posts: 128
Joined: Wed Jun 02, 2004 11:55 am
Location: Ann Arbor, Michigan

Re: Collector car tax

Post by jcwconsult »

Indeed, it was a spoof.

http://cityroom.blogs.nytimes.com/2011/ ... car-buffs/

A Fake Tax Rattles Classic Car Buffs
By MICHAEL BARBARO
Mock New York Times Article Click to see the mock New York Times article.
As April Fool’s gags go, the Shelby American Automobile Club’s 2011 spoof did not seem especially convincing. Until, that is, hundreds of classic car lovers across the country were duped, became enraged and started to organize against a nonexistent threat.
A few days ago, the Connecticut club printed a fake front page of The New York Times that included what purported to be a major scoop: to close the federal deficit, Senator Charles E. Schumer of New York was proposing a federal tax on specialty automobiles.
“Collecting classic cars is in the province of the haves — not the have-nots,” the article quoted Mr. Schumer, a Democrat, as saying. “Those who own these cars can afford a hefty tax on that ownership.”
The tax, he explained, would amount to a staggering 10 percent of a car’s value, and the Internal Revenue Service would open a new division to collect the fees.
Red flags seemed to dot this particular issue of The Times, however. The article about the car tax appeared next to another about a study showing that recreational polka dancers have significantly lower rates of colon cancer. (A diet of kielbasa and stuffed cabbage was cited as a probable explanation.) Oddly, all of the quotes appeared in italics. And the daily weather report was replaced by curious trivia about cars and horses in the 1900s.
Collectively, the page “should have hit readers in the head, so they knew this was a joke,” said Rick Kopec, the national director of the Shelby American Automobile Club, named after the famed car designer Carroll Shelby.
It did not. The fake edition of The Times was e-mailed to about 3,000 members of the car club, who forwarded it to friends, who posted it on Facebook and car blogs. In roughly the time it takes for a 1962 AC Shelby Cobra to go from zero to 60, the reality-distorting, anxiety-amplifying powers of the Internet had transformed the spoof into a legitimate news story.
Within days, Keith Martin, who publishes the Sports Car Market, started receiving e-mails and calls from horrified car collectors. “I will go broke,” one caller groused. “I won’t be able to afford my cars.”
Hundreds of messages poured into the offices of a trade group for car manufacturers and distributors known as the Specialty Equipment Market Association. Steve McDonald, the group’s vice president of government relations, fielded many of them. He made a few inquiries — and a visit to the Web site of The Times — and quickly realized it was a hoax.
“This thing went crazy on us,” he said.
The article, as outlandish as it seemed, had struck a chord. “Car guys assume that everyone is trying to take their cars away,” Mr. Martin said. “All politicians want us to ride bicycles, take buses or, best case, drive Priuses.”
The implausible classic car tax, he explained, felt just plausible enough.
With the uproar reaching its peak, Mr. McDonald, of the car trade group, reached out to Mr. Kopec and advised him to issue some kind of formal clarification. The article, Mr. Kopec wrote in a letter to club members, “reached a much wider audience than anyone could have predicted. He added, “We deeply regret if taking this story seriously has caused anyone undue distress or embarrassment.”
No one seems more amused than Mr. Schumer, whose first (and most beloved) car was a 1971 Plymouth Duster, and who, for the record, is not proposing a classic-car tax.
“Senator Schumer firmly believes in every American’s right to have tax-free fun, fun, fun, until their daddy takes the T-Bird away,” said Mike Morey, a spokesman for the senator.
The spoof, Mr. McDonald said in an interview, “was more successful than the author ever intended.”
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Jim Walker
365 GT 2+2 #12451
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