Will Sadler was kind enough to send me copies of those CA tax bills,
If I am wading through the gobbledegook right, they are rather
different than what's been described here, so I thought I'd summarize
what I think they say.
There seem to be three effects. All are primarily from AB758.
1) A 2.2 percent surcharge -on the registration fee- is imposed for
registrations or renewals after August 1, 1991 and before August 1, 1992.
This is a surcharge on the fee, not a tax on the value of the car, and
it's only in place for a year.
2) The market value of a car is now determined whenever the car is
sold, rather than only on first sale or registration in CA. Given the
depreciation schedule used by the state, this provision appears to
have no major effect for normal cars. It does look like a total screw
for people with funny little old sports cars, which don't depreciate
according to conventional models. These cars will, if sold frequently,
now be taxed at closer to their true market value, rather than the
artificially low levels achieved by applying depreciation formulas to
things that don't depreciate.
3) Owners who "modify or alter" a vehicle in such a way as to change
its market value by more than $200 (up or down) are supposed to report
this to the Department of Somethingorother, which will revalue the car
accordingly. This provision specifically excludes engine changes,
repairs, and modifications needed to meet smog checks. The effect of
this provision on collector cars seems to hinge on whether restoration
is considered "modification" or "repairs"; the law apparently provides
no guidance on this question. Being out here in Mass, I have no clue
whether there is any previous CA precedent on this. The basis of
revaluation is stated to be "cost to the comsumer", which presumably
means that if you apply $150 of paint and 1e06 hours of sanding to
your car, the market value goes up $150. Conversely, if you apply
eighty gigabucks of TRS to your street-legal midget, you might be
legally screwed. I find no mention of what happens if you don't
report, presumably any penalty will be set by later regulation.
Hopefully this is close to accurate. Sorry if I missed anything.
-john
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