Pandemic hits taxpayers’ wallets as car tax bills soar

Why are car taxes so much higher this year? It turns out, thanks to the pandemic, used cars are suddenly worth a lot more money now. In some cases, prices have jumped almost 30%

News 12 Staff

Jul 13, 2021, 9:42 PM

Updated 1,046 days ago

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At city and town halls across Connecticut, tax collectors' offices are busy with people feeling sticker shock – as car tax bills have skyrocketed.
Jafar Choudhury, of Norwalk, says his car tax bill went up, even though his vehicle is a year older.
Why are car taxes so much higher this year? It turns out, thanks to the pandemic, used cars are suddenly worth a lot more money now. In some cases, prices have jumped almost 30%
Used cars are in demand right now because new car production has slowed down. Initially that was due to factory shutdowns during COVID-19. More recently, a shortage of microchips used to make cars’ computer systems is to blame. Greg Dachohis, of Oxford Economics, says that has “led to unprecedented rapid rises in the price of certain goods.”
Tax assessors say it's out of their hands. Your car's value comes straight from the National Auto Dealers' Association. The tax bill is actually based on last October's assessment. Your car will be reassessed this October.
Could residents see an even bigger bill next summer? John Rainaldi, of the Connecticut Association of Assessing Officers, says the “data we're looking at so far indicates that values have continued to increase."
You can appeal your car tax bill but you'll have to prove the assessment is too high.
Choudhury says he can't swallow another tax hike. He says "hopefully" the car market will cool down.
Economists predict prices should level off by 2022, as computer chip supply improves and new car production ramps up.


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