I’m not much for local politics, or for updating my blog regularly, but a headline in today’s Express-News made me angry. Superpowers notwithstanding, I shall blog.
Texas is considering, as part of a tax-reform package, a measure that would charge sales tax to used automobiles based on the “value” of the vehicle rather than its sale price. This is, quite frankly, insane.
Aside from the obvious enforcement problems — and the lovely proposal that if a buyer objects to paying taxes on the blue-book value of the car he or she can pay to have an assesment done by a dealer or an insurance adjuster — it seems that our lovely duly elected representatives in Austin don’t understand that the sale price of the care is, in fact, the value. It’s quite simple: a buyer and seller negotiate and come to an agreement about how much the car is worth to each of them, money is exchanged, and LIKE MAGIC, the title changes hands. This is how markets work, and I can think of no better example of a purely voluntary market than private seller used cars. Quite nearly perfectly competitive, lemons be damned, and relatively free of interference. It’s plainly obvious that consumers will hate this, adjusters will hate it, and sellers will hate it: why on Earth, then, would our dear leaders want to go through with such a proposal?
“Dealers have to disclose things that private individuals don’t,” said Bill Wolters, president of the Texas Automobile Dealers Association. “With individuals, there is less of a paper trail, less verification and less regulation.”
And there’s the answer, a powerful interest group wants to “level the playing field”. Of course! And how fearful we should be that people can buy or sell used cars on their own without some government gate-keeper to regulate every step of the deal. Where there are not forms, there’s chaos!
Oy. Vey.
