Gop Trims Proposed Cut In Vehicle Excise Tax Republicans Want To Give Bigger Break To Newer And More Expensive Vehicles

Sat., Jan. 24, 1998

Joseph Turner Scripps-Mcclatchy Western Service

The $45 tax cut Republicans are proposing to give to Washington state motorists is getting smaller - except for owners of new cars and trucks.

Republican lawmakers have revised the tax-cut portion of their proposed transportation plan - partly to give a larger tax break to owners of newer, more expensive cars and partly to make their plan pencil out.

The proposed tax cut would be reduced to $40.

On the other hand, Republican leaders also want to change the depreciation schedule that’s used to figure out how much excise tax motorists have to pay. The value of a vehicle would drop more rapidly, so new-car owners would pay lower taxes.

Sen. Jim West, R-Spokane, chairman of the Senate Ways and Means Committee, said he wants to change the schedule because it’s unfair.

For tax purposes, the state sets the value of a car or truck at 100 percent of the manufacturer’s suggested retail price - not just for the first year after it’s purchased but also for the next year.

“The current schedule makes no sense,” West said. “The value is held at that artificially higher level for two years. That’s a stupid system that should never have been put in place. People hate it.”

Under the revised depreciation schedule, the owner of a year-old vehicle valued at $25,000 would pay $514.25 in excise taxes, instead of $550 under the current schedule. That’s a savings of $36 a year, in addition to the $40 across-the-board cut.

Republican leaders have readjusted their plan in preparation for a Monday hearing before the House Appropriations Committee.

Appropriations chairman Tom Huff, R-Gig Harbor, said he has scheduled a hearing for Monday, a committee vote on Tuesday and expects the full House to approve the measure Wednesday.

Besides cutting vehicle excise taxes, Republican lawmakers plan to shift money from the state’s general operating budget into a transportation fund so the state can build an additional $2.4 billion worth of new road projects over the next six years.

Gov. Gary Locke also has proposed cutting the excise tax - by $35 per vehicle - and raising the gas tax by 11 cents a gallon to pay for $2.4 billion in new projects.

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