The Registry of Motor Vehicles prepares excise bills according to the information on the motor vehicle registration. They are sent to the city or town assessors who commit them to the local tax collector for distribution and collection of payment. Cities and towns may also prepare their own bills based on excise data sent by the Registry in conformity with Registry requirements.
An excise at the rate of $25 per one thousand dollars of valuation (effective January 1, 1981) is levied on each motor vehicle. Information on the value of a motor vehicle is accessed electronically through a data bank complete with valuation figures. Different sources provide the valuation figures depending on whether the motor vehicle is an automobile, a truck, a motorcycle, or a trailer. For example, automobile valuations are derived from figures published in the National Automobile Dealers Association Official Used Car Guide (NADA), to which the Registry has electronic access. Most public libraries have copies of NADA and other motor vehicle official guides.
Manufactured List Prices
Figures are the manufacturers' list prices for vehicles in their year of manufacture. Present market value, price paid, or condition is not considered for excise tax purposes. The excise tax law (M.G.L. c. 60A, s. 1) establishes its own formula for valuation for state tax purposes whereby only the manufacturers' list price and the age of the motor vehicle are considered. The formula is as follows:
- In the year preceding the designated year of manufacture
(brand new car released before model year) 50%
- In the designated year of manufacture 90%
- In the second year of manufacture 60%
- In the third year of manufacture 40%
- In the fourth year of manufacture 25%
- In the fifth year of manufacture 10%
Every motor vehicle owner must pay an excise tax based on valuation of at least ten percent of the manufacturer's list price; thus, owners of vehicles older than five years should have a fixed excise tax bill for succeeding years of ownership. Even though an owner may have applied for an abatement, which may reduce an excise tax bill, no excise shall be less than $5.
Excises are prorated on a monthly basis. If a motor vehicle is registered after the beginning of any calendar year, no excise will be imposed for those months, if any, which have fully elapsed before the vehicle is registered. If a vehicle is registered for any part of a month, however, the excise will be due for all of that month. The annual excise due on a car registered after January 1 will be reduced therefore, by one twelfth of the full year's excise for every month prior to the one in which the vehicle was registered.
Local tax collectors are responsible for collecting the motor vehicle and trailer excise. Collectors may appoint deputy tax collectors or may enter into agreements with collection agencies to assist them in the collection of delinquent accounts. Money collected on all bills, excluding deputy tax collectors' fees is put into the municipal treasury. Generally tax collectors and deputy tax collectors do not accept partial payment of an excise tax bill. Taxpayers should be prepared to pay the full amount due. There are no special considerations for financial hardship.
Payment of the motor vehicle excise is due 30 days from the date the excise bill is issued (not mailed, as is popularly believed). According to Chapter 60A, Section 2 of the Massachusetts General Laws, "Failure to receive notice shall not affect the validity of the excise." A person who does not receive a bill is still liable for the excise plus any interest charges accrued. Therefore, it is important to keep the Registry, local assessors, and the post office informed of a current name and address so that excise bills can be delivered promptly. All owners of motor vehicles must pay an excise tax; therefore, it is the responsibility of the owner to contact the local assessor if he/she has not received a bill.
Penalties for Non-Payment
If an excise is not paid within 30 days from the issue date, the local tax collector sends a demand. Interest accrues on the overdue bill from the day after the due date until the date of payment. If the demand is not answered within 14 days, the collector may issue a warrant to the deputy tax collector or an appointed agent. The taxpayer is then additionally liable for a warrant fee. If this notice is not answered, then a final warrant, a service warrant, will be delivered or exhibited to the taxpayer at his/her residence or place of business. All bills should clearly state the interest and penalty charges.
Non-Renewal of Registration and Driver's License
If the service warrant demanding final payment is ignored, the collector may then notify the Registrar of Motor Vehicles of such non-payment, including all accrued interest and penalty fees. The Registrar may then mark the individual's registration preventing the renewal of the motor vehicle registration and the owner's driver's license until such time as the Registrar is notified that full and final payment has been made to the city or town.
This payment shall include a release fee as final settlement of the delinquent excise. Once the bill has been paid, the municipality will give the motorist a receipt so he or she can return to the Registry to re-register his / her vehicle. Although the local tax collectors do notify the Registrar that the matter is resolved, it is strongly advised to retain the certified receipt of payment for presentation to the Registry of Motor Vehicles. Cities and towns relay computerized notification that excise bills have been paid only periodically to the Registry. Local tax collectors, in effect, have up to six years to notify the Registrar of non-payment.
Excise Tax Law
Under the excise tax law, tax collectors have six years from the issue date of a bill to notify the Registry of non-payment by a driver (M.G.L. c.60A, s.2), unless the tax record shows a history of non-payment. However, under the Registry's own policy, this notification time has been reduced to just two years. If the record does show a history of delinquency, the tax collectors can electronically mark the driver's record and institute proceedings to collect for as many years back (beyond six years, in other words) as necessary and notify the Registry. The Registry, in turn reviews each notification beyond two years. If a taxpayer has had a good history of payment and suddenly receives a bill dating back more than six years, the assessors will assign a tax collector to collect the bill; the tax collector in turn, will attempt to collect and assess late fees and penalties, as is required by law if applicable. However, the collector can no longer mark the driver's record for non-payment since the Registry only allows two years for notification from the issue date of the bill. Thus, the taxpayer's ability to renew the license, in this instance, is not hampered; but the bill must be resolved with the tax collector.