Information on the car (excise) tax
The 2016 bill is the tax for vehicles registered any time between January and December 2015*
• This tax begins on the day you register your car at DMV, but the tax bill comes out in the following year.
• The bill is paid every three months (quarterly)…on the 24th of July (1st quarter), October (2nd), January (3rd), April (4th).
• A bill that is not delinquent can be paid in in quarterly installments. If you miss an installment, it is best to pay the entire remaining tax plus the interest to minimize the cost.
• It is not connected with the sales tax on the car you pay only once to DMV upon purchase.
• The car tax ends when your registration terminates or you turn in the plates, although, again, you will be billed for it in the following year. See the last section for more on how this works.
How the tax is calculated.
Please note that the standard exemption on car value was raised from $1,000 to $2,000, resulting in an overall reduction of $60 on the annual tax.
The tax is based on a formula using the value of the car as determined by the state, the tax rate (Providence's tax rate is $60 per thousand of value), minus the exemption for value ($2,000) and divided the number of days in a calendar year out of 365 that the registration is active.
To put it another way, the tax based on the actual number of days the car is registered in a year. and on the value of the car as determined by the State of RI. The state uses the National Automobile Dealer Association "clean resale value" for car value.
For example, if your car's value is set at $5,000, with the $2,000 exemption, you would be taxed on $3,000 of value. At a tax rate of $60 per $1,000, this car's tax would be $60 x 3.00 = $180 for a full year. If it was registered for half the year (182 days) the tax would also be half, or $90.
Privately owned cars are billed to the individual; leased cars are usually billed to the leasing company.
Out of state or foreign students who register a car in Rhode Island are not exempt from the tax. Active duty military who claim RI as their domicile are not exempt from this tax.
Registration blocks when the tax is not paid. Once a quarterly payment deadline is missed, the account is considered delinquent. Failure to pay any quarterly installment will result in interest charges and the acceleration of the entire annual tax. In addition, the City will place a block on your registration renewal for that car and any others also registered to you.
If registration renewal is blocked by DMV for failure to pay the tax: you need to pay the tax in full AND request clearance from this office. If you have a registration block and you are not behind in your tax, contact us for a clearance.
How interest is calculated. City ordinance controls interest accrual: when ANY quarter is paid after the due date, the ENTIRE portion of the unpaid bill is due AND interest is assessed at 1% a month from July to the date of payment.
Example of interest accrual:
If you have a $400 annual tax (Four $100 quarterly payments) and miss the third installment of $100 in January, the past due tax in the following month of February will be $216.00. (Third and fourth quarter's installment of $100 each, plus 8% interest on $200, or $16.) The only way to prevent interest from accruing further is to pay the account and interest in full.
The assessed value of your car is set by the state. Appeals.
RI DMV uses the National Automobile Dealers Association (NADA) "clean resale value" for vehicle valuation. While you may appeal the bill, you cannot appeal the tax based on condition of the car, mileage or sale price. Appeals should be directed to the City Assessor. Consult the back of the tax bill orwww.providenceri.com/assessor. Appeals must be made 30 days after the mailing of the bill. The deadline to submit an appeal is August 24, 2015.
Notify DMV within 10 days of moving or disposal of the vehicle. DMV provides all RI municipalities with a car tax database, based on DMV's registration data. To prevent a problem when you move, file a change of address for each affected vehicle within 10 days. You can download the change of address form at www.dmv.ri.gov. Submitting the change of address form will update local municipalities and move you from place to place. If you don't file the change of address form, the next tax bill will come from your old town to your old address.
Promptly turn in in your license plates or else your tax continues until the plates expire. When you (1) discontinue a registration (for example, going from two cars to one, or after a death) or (2) register your car in another state due to relocation, you need to terminate your registration with DMV to stop the tax from being charged.
If you do not turn in your plates, you will continue to be taxed on the vehicle attached to that registration until the plate runs out.
* The current (2016) bill is for vehicles you owned in calendar year 2015.
The car tax is figured on what vehicles you owned last calendar year. So, whatever is in the DMV database (what cars you own, what town the registration is in) in 2015 will receive a bill in June 2016, and the first quarter is payable on July 24, 2016.
A car registered during 2016 will not get a tax bill until June 2017.
If you move:
Out of state. Mail the plates back to DMV when you get new plates elsewhere. If DMV gets your RI plates on November 1, 2015, you will get a prorated tax bill for 10 months (Jan-Oct) of registration in June of 2016 to your new address or last RI address if no address is provided.
Within Rhode Island. If you move from Providence to another town in RI, submit a change of address to DMV within 10 days. The entire tax year wii be payable to the town where your car was registered as of December 31.