MA Residents: Pay Up: This Yearly “Nuisance” Tax Will NOT Go Away

It's April in Massachusetts. Spring is in the air! Time for those annual rites of passage like watching flowers bloom in Boston's Public Garden, cheering on marathon runners on Patriots Day and let's not forget this is the time to file your taxes, but there is another tax The Bay State has to deal with: The motor vehicle excise tax.

No doubt this yearly bill is a burden, but why do we have it? And is there any chance this could go away? The answer in two letters: NO! 

Statistics show that Massachusetts is one of 27 states that charges residents just to own a vehicle. Basically, the tax is $25 for every $1000 of valuation, with other considerations. My excise tax bill came out to a little over $36 but it is no comparison on what I was paying south of the border. In Connecticut, they call it a "property tax" and the final estimate amounted in triple digits (over $200) which was a chunk of change if you ask me, hence my move up north as the savings are significant in nature. The added insult is at one time this was tax deductible: NOT anymore! Constitution Street drivers, I feel your pain, that is one reason why I don't reside there anymore!

Eileen McAnenny, from the Pioneer Institute, an independent local think tank, explains why we have the excise tax, when others don't:

"Massachusetts tends to provide more social services and other services and have higher cost than many other states," she said. "So they look for a variety of sources of revenue and more sources of tax revenue than many other states".

It is designated as a state tax, but cities and towns collect it. Though many think it's used for streets and roads, transportation or other infrastructure, that's actually not the case. The collected revenue goes into the general fund, so every municipality can use it however it wants.

A little history on how this all began in our backyard: The excise tax was first collected in 1928, back when a Ford Model-A was the most popular car in America. Since then, the state has grown to depend on it, this yearly ritual that everyone does NOT look forward to. almost as much as we depend on cars, so don't count on it going away.

It does bring in money: For example, the capital city of Boston took in almost $61,000,000 last year. Worcester took in $18,000,000, that's more than the combined budget of the 2nd largest New England city's Public Library and several departments, so there is traction

There are also exemptions and abatements to the tax. Check with your local Town Hall for this all-important information. Of course, those who reside in urban areas can forgo it all together but that likely involves another T word – the MBTA. Take note, If I were back in my ol' hometown of New York City, the subway, bus or walking would get me from point A to point B (I would NOT need a car for sure). Here in the Berkshires, we have the BRTA, but the bus systems routes don't cover too much territory and they don't run 24 hours a day, so the end result is we need our cars for reliable transportation.

BOTTOM LINE: Bite the bullet, pay the excise tax and get it out of the way. After all, $36 surely is an improvement to over $200 as mentioned earlier.