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NY Plans 5% Extra Tax On Cars Over $60K

Go easy on the options if you plan on buying in the Empire State

By Gunnar Heinrich | IMG from MBUSA.com

LUXURY car buyers in New York are going to have to be a little savvier in choosing where to shop, while New York auto dealers are going to have to work that much harder to make the sale over nearby competition in Connecticut and New Jersey.

New Yorkers are facing a broad tax hike on various goods ‘n services (including a new “iPod tax”) in a planned budget set to go before Albany’s legislature.

Among the line items is a measure that levies an additional 5% tax on all cars sold for more than $60,000. 

So, what this will likely mean in practical terms…

If you’re a New Yorker and you were thinking about driving out to, say, Pepe Motors in Westchester to order an ‘09 E350 4-MATIC, watch which packages you choose. With a starting price of $54,075, the midsize Benz is already close to that $60K redline when stripped of any options.

Add “Premium 1 Package” to get COMAND, heated seats, and a rear sun shade for $2,700 plus maybe a set of mud mats for the winter months and with current NY State taxes plus dealer fees you’ve just made it under.

Go for “Premium 2 Package” with bi-Xenon lights and keyless go and in passing $60,000 you’ll get slapped with an extra $3,000 tax bill courtesy One Empire State Plaza, Albany.

Or you could just hop over the state line to Mercedes-Benz of Greenwich and not bother worrying.

Considering that the bulk of NY’s luxury car sales happen in the Tri-State metro area, that the Governor would seek to put a measure in place that feeds rival dealerships in neighboring states seems penny smart and dollar stupid. 

What is clear is that in facing a $14 Billion deficit, the Empire State is striking back at its own to make ends meet. Let’s hope that other legislatures don’t follow suit.

[Linked: NY Daily News]