MA Motor Vehicle Excise Tax - Model 3

[David29]

Don't know whether to be pleased for the OP or annoyed because I paid and continue to pay excise tax for the base price of a Model S 70D, not the base price of the 60 RWD or whatever was the cheapest model at that time.

As a Tesla buyer, I would want the town to calculate the excise tax in the most advantageous tax for me. Congrats to the OP for being able to make the argument successfully and get your taxes adjusted.

But as a taxpayer that wants a level playing field and everyone to pay their fair share, I'd say Tesla is gaming the system if they were to argue that batteries and motors are part of accessory or option packages rather than as fundamental features that distinguish one model from another. Furthermore, there is no $35,000 version of the Model 3. If there were, that might be different. When I bought my 70D, there was no 40 KWH model, but there had been one, briefly, a few years earlier. My Monroney sticker lists the 70D's price as the "base price." (Maybe there was no cheaper version of Model S at that time, not sure.) So should Tesla have said that the base price for my car was the price of a 40 or 60 kWh version even if there was no such version being produced?

Makes me wonder what buyers of higher-end Mercedes or BMWs are taxed on -- the base price of the cheapest 3-series or C-class, or E-class or 5-series, or the performance version or cabrio versions or coupes, etc?

What do Model S owners pay if they have 90 or 100 kWh batteries? Tax based upon the 75 kWh battery model? Or what?

 

[David29]

Wow that would be awesome. Based on every other car I have owned in MA for the past 20 years, that's exactly what I would expect, BASE MSRP before options.

So that makes sense -- but what is the definition of an "option?" Is the 90 or 100 kWh battery and its associated larger motors really an option for the base Model S with a 75kWh battery? Or are the 90 and 100 kWh cars really separate models, since they have different batteries, motors, and who knows what else?

If we were discussing a 5-series Mercedes, is the expensive convertible version an "option" to the base sedan? or is it a different model? Big difference in price.

Just trying to understand the logic here, in the interest of a level playing field.

 

[David29]

I just got a call back from the RMV. They said the sticker does not use the words MSRP so it can't be used. Well neither does my purchase agreement or any other document. It's a window sticker, that is the function of a window sticker!

Interesting detail. My window sticker from 2015 for the 70D uses the phrase "Standard Vehicle Price," not MSRP or base price, as the starting price before adding in the options.

 

[shadownddust]

I think the question of what is an option vs another trim is an interesting one. In general the luxury vehicles you mentioned I believe are taxed based on the major differences which the manufacturer distinguishes by the badging and associated differences (engine size/performance, defining features like a convertible). What makes Tesla's approach interesting, is that the way they've structured the purchase process, there's very little difference between the various 'trims', so a larger battery borders on the option territory, as it's just another check mark on the order page, not a different page altogether.

This is actually one of my favorite parts about packaging or lack there of. With any other car if you want certain features/functionality, you need to move up in trim level to get it even if you don't want anything else. Many times if you want something like a bigger engine, you also are forced to get the advanced parking, and the better lighting systems, and maybe even updated exterior details. With the exception of one or two aesthetic things, there really isn't much difference between the battery sizes. It's almost strictly about how far you want to go. I understand that with a different motor and power available, there are performance considerations, but that's why I think it's on the border, especially between the non-performance variants.

It gets even more interesting when you look at the M3 and there's no external branding of the different ranges.

I think my preference would be that the distinction is between performance and non-performance. The battery would be an option (a very expensive option), that wouldn't be taxed differently (coming from someone who has a 75D, not a 100D). But I have given next to no thought on what the potential implications of that would be.

 

[PeterK]

Don't know whether to be pleased for the OP or annoyed because I paid and continue to pay excise tax for the base price of a Model S 70D, not the base price of the 60 RWD or whatever was the cheapest model at that time.

As a Tesla buyer, I would want the town to calculate the excise tax in the most advantageous tax for me. Congrats to the OP for being able to make the argument successfully and get your taxes adjusted.

But as a taxpayer that wants a level playing field and everyone to pay their fair share, I'd say Tesla is gaming the system if they were to argue that batteries and motors are part of accessory or option packages rather than as fundamental features that distinguish one model from another. Furthermore, there is no $35,000 version of the Model 3. If there were, that might be different. When I bought my 70D, there was no 40 KWH model, but there had been one, briefly, a few years earlier. My Monroney sticker lists the 70D's price as the "base price." (Maybe there was no cheaper version of Model S at that time, not sure.) So should Tesla have said that the base price for my car was the price of a 40 or 60 kWh version even if there was no such version being produced?

Makes me wonder what buyers of higher-end Mercedes or BMWs are taxed on -- the base price of the cheapest 3-series or C-class, or E-class or 5-series, or the performance version or cabrio versions or coupes, etc?

What do Model S owners pay if they have 90 or 100 kWh batteries? Tax based upon the 75 kWh battery model? Or what?

When I got my X they based my tax on the Signature price, which was well above even my P model, eventually I got it reduced but I don’t think to 75D level. And this time with the 3 they seem to have picked a number out of the air, so I showed them the MVPA and sticker and complained. There is a point to considering a significantly different trim as a different base model, but if I have a choice of 4- or 6- cylinder in an otherwise identical car I don’t think they charge higher excise tax on the 6. (Though interestingly, in many countries the engine displacement is the primary driver of vehicle tax.) So why should they charge higher for the long-range battery?

Btw the 70 replaced the 60 in spring 2015 so there is no rational argument for the 70 to be taxed based on the 60 price. They re-introduced a software-limited 60 in 2016, but killed it in 2017.

 

[JWardell]

To update, I visited my assessor in the town hall today, who filled out an abatement form in person. They said I should pay the bill because it will not be processed in time for the Nov 7 due date, and they will mail me a check in a few weeks. Unfortunately it is only about $100 difference for the six months billed, obviously I stand to save more next year. They also said to hang on to the letter because there is a good chance the RMV will still not update its database and I could again be incorrectly billed next year.
Sounds like this is not uncommon. What a terrible system.
So please keep an eye out and spread the word!

 

[yousexy]

too late for me.

but I'll take a closer look at the Model X that is coming this month.

 

[tga]

too late for me.

How so? You can apply for an abatement and get a partial refund, even if you've already paid the bill.

 

[shadownddust]

How so? You can apply for an abatement and get a partial refund, even if you've already paid the bill.

Indeed, I think you have 3 years from the bill date.

 

[yousexy]

I took the S delivery May 2015. I can still apply for an abatement?

 

[shadownddust]

I took the S delivery May 2015. I can still apply for an abatement?

Potentially for the last 2-3 bills, though I haven't dealt with the process after depreciation kicks in, so I don't know how the value is determined.

 

[yousexy]

Thanks. I thought the same thing after I replied. going to do some homework tonight. lol

 

[atownev]

So, I finally got a revised value from the state, via my town. They have chosen to value my RWD LR at 49000 instead of 44000. WTAF? Yet some of you are getting AWD valued at 35000? What the hell do we have to do to get the RMV to get its story straight? They seem to be completely messed up.

 

[PeterK]

So, I finally got a revised value from the state, via my town. They have chosen to value my RWD LR at 49000 instead of 44000. WTAF? Yet some of you are getting AWD valued at 35000? What the hell do we have to do to get the RMV to get its story straight? They seem to be completely messed up.

What a mess. I tried to get some attention to this at Tesla but didn’t have any response. You might try the executive escalation button. Tesla should be directly communicating the values to RMV.

 

[Bokonon]

Quick update on my situation, which is still ongoing...

RMV called back on November 20th, asking me to fax over the window sticker (again). I did, it went through, but they claimed they did not receive it because their fax machines were "being replaced" (???). I sent it again this afternoon (five times in total), and eventually their fax machine produced a copy that they could *almost* read... so I helped them out by reading the "as configured" section to them, line-by-line, clearly identifying $35K as the base price, and the rest as options.

After all that, they told me "the number in the system still says the value is $56,500" but that they would "do some more research" and send me and the City of Newton a letter with "the correct value" within a week. Which is basically the same thing they told me when I first called over three weeks ago.

As if that weren't enough, seeing my fellow Newtonian (Newtoner?) @atownev get a completely different valuation from the $44K most other RWD folks are getting only adds to the impression that the RMV is just pulling numbers out of a hat.

What a mess. I tried to get some attention to this at Tesla but didn’t have any response. You might try the executive escalation button. Tesla should be directly communicating the values to RMV.

Agreed. I'll try escalating as well.... the more voices, the better!

 

[TORQU3]

I just got my excise tax bill in (late Sept purchase). I forgot to take a picture or write it down but, but had a value of 46,XXX I believe. I'm going to have to start this game with them now.

 

[Bokonon]

The RMV called me back this morning with an updated valuation and an explanation for how they arrived at the number. The rep that I spoke with (Stephanie) explained to me, going forward, that the methodology for calculating Model 3 valuations would work like this:

• Base price of the car ($35K) is included in the valuation
• Price of the drivetrain hardware ($4K or $5K for AWD / Performance) is included in the valuation, because "it's what makes the car go"
• Price of the battery ($9K for Long Range) is included in the valuation because "it is part of the drivetrain"
• Price of all other options (autopilot, premium upgrades, etc) is not included in the valuation

Theoretically, then, the valuation for my AWD Model 3 should be $35K + $9K + $4K = $48K, so the excise tax should be calculated based on 90% of that, or $43,200.

Unfortunately, there's an additional catch... the RMV can only go by what Tesla puts on the window sticker, and in my case, the itemization incorrectly bundled the cost of the Premium Upgrade Package into the drivetrain:

Model 3 = $35,000
Long Range All Wheel Drive = $18,000
Premium Interior = Included
Deep Blue Metallic Paint = $1000
Enhanced Autopilot = $5,000
19" Wheels = $1,500

As a result of this oversight on Tesla's part, the RMV has calculated my valuation at $35K + $18K = $53K, which leads to an assessed value of $47,700.

Based on @TORQU3's post above, it seems that the RMV is already sending this new AWD valuation to cities and towns. It's a bit frustrating to owe the extra tax due to what is basically a clerical error on Tesla's part, especially when the RWD window sticker the RMV happened to see correctly itemized the PUP as an option, thereby excluding it from the valuation. I suppose it's just another consequence of being an early adopter.

To @PeterK's earlier point, to the extent that this issue arises from a lack of clarity and consistence on Tesla's part when it comes to itemizing the price of a Model 3, it probably makes sense for all of us affected to use the "Executive Escalation" feature in our Tesla Accounts to report the issue and encourage Tesla to clearly communicate to the Mass RMV how Model 3 pricing works. That way, we'll have a better chance of avoiding this issue when we start to see our 2019 excise tax bills show up within the next few months...

I just got my excise tax bill in (late Sept purchase). I forgot to take a picture or write it down but, but had a value of 46,XXX I believe. I'm going to have to start this game with them now.

Just to confirm, based on your profile pic, it looks like you have Performance AWD? In that case, $47,700 does seem to be the assessed value the RMV is using right now.

 

[PeterK]

The RMV called me back this morning with an updated valuation and an explanation for how they arrived at the number. The rep that I spoke with (Stephanie) explained to me, going forward, that the methodology for calculating Model 3 valuations would work like this:

• Base price of the car ($35K) is included in the valuation
• Price of the drivetrain hardware ($4K or $5K for AWD / Performance) is included in the valuation, because "it's what makes the car go"
• Price of the battery ($9K for Long Range) is included in the valuation because "it is part of the drivetrain"
• Price of all other options (autopilot, premium upgrades, etc) is not included in the valuation

Theoretically, then, the valuation for my AWD Model 3 should be $35K + $9K + $4K = $48K, so the excise tax should be calculated based on 90% of that, or $43,200.

Unfortunately, there's an additional catch... the RMV can only go by what Tesla puts on the window sticker, and in my case, the itemization incorrectly bundled the cost of the Premium Upgrade Package into the drivetrain:

Model 3 = $35,000
Long Range All Wheel Drive = $18,000
Premium Interior = Included
Deep Blue Metallic Paint = $1000
Enhanced Autopilot = $5,000
19" Wheels = $1,500

As a result of this oversight on Tesla's part, the RMV has calculated my valuation at $35K + $18K = $53K, which leads to an assessed value of $47,700.

Based on @TORQU3's post above, it seems that the RMV is already sending this new AWD valuation to cities and towns. It's a bit frustrating to owe the extra tax due to what is basically a clerical error on Tesla's part, especially when the RWD window sticker the RMV happened to see correctly itemized the PUP as an option, thereby excluding it from the valuation. I suppose it's just another consequence of being an early adopter.

To @PeterK's earlier point, to the extent that this issue arises from a lack of clarity and consistence on Tesla's part when it comes to itemizing the price of a Model 3, it probably makes sense for all of us affected to use the "Executive Escalation" feature in our Tesla Accounts to report the issue and encourage Tesla to clearly communicate to the Mass RMV how Model 3 pricing works. That way, we'll have a better chance of avoiding this issue when we start to see our 2019 excise tax bills show up within the next few months...



Just to confirm, based on your profile pic, it looks like you have Performance AWD? In that case, $47,700 does seem to be the assessed value the RMV is using right now.

Thanks for the info. Did you have a chance to ask them if they charge extra for all ICE drivetrain upgrades as well? Eg the six cylinder, turbo, or AWD vs a four? Though in most cases that comes with a trim upgrade...

 

[TORQU3]

Just to confirm, based on your profile pic, it looks like you have Performance AWD? In that case, $47,700 does seem to be the assessed value the RMV is using right now.

I just pulled out the bill, valuation is $45,900. So if that's 90% of the MSRP they are assuming a $50k MSRP. Guessing it's something like this, 35k base + 9k LR + 5k AWD. Unless they are assuming 6k for the AWD option? I can't keep track of what that costs.

Either way, by the logic described that the RMV is using I'm ok with it I guess. At least they aren't dinging me for the performance upgrade since it is technically the same drivetrain.

 

[TORQU3]

I just looked at my sticker. I’m glad I didn’t send that in. First line is the car, 35k, next one is the performance upgrade for 29k. If I would have submitted the window sticker for an abatement I might have shot my self in the foot.