HOW ARE GEORGIA'S AUTO LEASE LAWS CHANGING?
Car leasing in Georgia has changed and is now a bit different than in most other states. Since March 1 of 2013, Georgia has a new Title Ad Valorem Tax (TAVT) that applies to all new car purchases and leases, as well as used car purchases. The tax is paid up-front (or rolled into financing) at the rate of 7.0% of the fair market value of the vehicle, as determined by the Georgia Department of Revenue, or the vehicle selling price (whichever is greater). The rate could go as high as 9.0% in following years.*
Nissan South Morrow strives to keep you aware of anything affecting your ability to buy or lease a new vehicle, making the purchasing process as easy as possible.
As of January 1, 2018, TAVT on leased vehicles will be calculated based on the total of lease payments rather than the full value of the vehicle.
WHAT DOES HB 340 MEAN FOR YOU?
Previously, if you bought or leased a $20,000 car, you will be assessed $1,400 in TAVT. The TAVT is calculated based on the price of the vehicle, due at signing. The new rules would mean that on a $299/month base lease payment, you would be assessed based on the sum of the lease payments, or 10,764. You have the option to pay this amount, which is 753.48 (instead of $1,400) at signing OR throughout the term of the lease. This means that your amount due at signing could be thousands of dollars less than before the law. Also, on a $20,000 vehicle, the new law means 746.52 in savings.
WHAT IS TAVT?
TAVT stands for Title Ad Valorem TAX. Motor vehicles purchased on or after March 1, 2013 and titled in this state are exempt from sales and use tax and annual ad valorem tax, also known as the "birthday tax". These taxes are replaced by a one-time tax that is imposed on the fair market value of the vehicle called the title ad valorem tax fee ("TAVT").**
**Source: Georgia Department of Revenue