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Vehicle Tax

CEDAR RAPIDS, IA (CBS2/FOX28) - Its not unusual to hit a stretch on any of Iowas interstates bumpy enough to make your teeth rattle and tempt you to look in the rearview mirror to see if the patches and potholes shook loose any car parts or sent a hubcap flying into the ditch.  Planners with the Iowa Department of Transportation are well aware and that has them looking for additional road repair funds.  But one option, to raise vehicle registration fees from five to six percent has car dealers in the state ready to fight.

Gavin McGrath, General Sales Manager at Pat McGrath Chevyland says its a burden customers shouldnt have to bear when they buy a new or used car.  Its such a high dollar item, I mean our average cost right now at the Chevy store is about twenty thousand dollars so youre asking a customer to pay a lot in sales tax. 


Iowa car dealers say its not chicken feed.  On a  $35,000 vehicle, such as a new Silverado truck thats an extra 350 dollars and even on a used car they say its probably $150  more.     


The idea of a one-percent increase in vehicle registration fees is one of many floated by the Iowa Department of Transportation to generate more dollars for road repairs.  IDOT Planner Cathy Cutler says funding has flat-lined and the state doesnt expect much help from the federal government.  She says raising the registration fees to match the state sales tax would generate nearly $60 million dollars every year.   It's revenue we really could use to maintain Iowa's infrastructure and repair some of the old bridges and really keep Iowa's transportation system strong. 


McGrath says the question is whether car and truck buyers should pick up  the tab when they pick up a new car or truck.  " We're already asking our consumers to pay a lot in tax - it's already a big dollar item and they're paying a big number in tax so we're certainly behind our customers. "


At this point the increase in vehicle registration fees is just a proposal, but the IDOT welcomes public comments before theres any decision.



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