Hybrid and electric car owners will pay more in taxes

Mississippi hybrid and electric car owners will pay more in taxes

GULFPORT, MS (WLOX) - Some hybrid and electric car owners are going to be sticker shocked not by the price of the car, but by a new taxes they’re going to have to pay on their vehicle. The new tax went into effect October 1st and is part of the massive infrastructure improvement bill passed earlier this year by the legislature.

Buy or drive a popular hybrid like a Toyota Prius, and you’ll pay an extra $75 dollars a year. The tax bite on an electric car like a BMW, and the price climbs to $150 dollars a year. The tax goes up every year too based on the rate of inflation.

What were lawmakers thinking when this tax was given the green light? Representative Hank Zuber has an answer.

“Since the state transportation system is supported solely by the gas tax, that they should pay some type of tax or have some type of expenditure to help support the state infrastructure,” he explained.

But the gas tax has been the same for more than 30 years, 18 and a half cents. That didn’t go up. Car dealers are hearing about it from customers.

David Potter is a sales manager at Allen Toyota.

“We’ve had a lot of them who have purchased vehicles who have come back and asked us, ‘why are they doing this or what is it for, and can you help us with this?’ These people are driving hybrid vehicles to save money and not pollute the air,” he said.

Stacey Jones just bought a hybrid. His reaction was typical.

“I was shocked. I was very upset because we started off getting a tax credit, and we’re going to have to pay it back,” he said.

Some might turn away from the gas savers, according to Potter.

“If they’re not saving money on gas to the level where they don’t see the similar savings, they might stop buying hybrids and and start buying other vehicles,” he explained.

One of the more puzzling aspects of the new law, which went into effect October 1st, is the way the mindset has changed regarding hybrids and electrics. Five years ago, the owners of those cars were thought of as environmental heroes.

Potter says today, not so much.

"They used to give a credit for hybrid vehicles, and now they’re taxing you. I just don’t see why paying less in gas is bad. There should be a better way to build our roads and build our community.”

And for some, like Jones, it’s simply a matter of fairness.

“I want to do better for the environment. I want to get better gas mileage. I don’t think I should be penalized for it, at all," he said.

Representative Zuber says an effort is now underway by some lawmakers to file a bill that would repeal the hybrid and electric tax section of the infrastructure program, adding he’ll support such a move. It could come up during the next regular session of the legislature in January.

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