The Tax Bite
on Everyday Products….CARS

Incredibly, the average family pays more in taxes today than for food, clothing and shelter combined. Indeed, you probably don’t realize how much you are paying in hidden taxes when you buy such necessities.

Take the average family car, for example. Cars, of course, are subject to state and local sales tax, averaging 5 percent. Moreover, consumers must also pay a so-called luxury tax of 9 percent on car sales prices over $34,000.

In addition, after the purchase of a car, in most states the consumer must pay each year a personal property or excise tax, averaging about 3 percent of the annual value of the car. If you keep the car for 5 years, these taxes can amount to 10 percent of what you paid for the car.

Combined with taxes on income, payroll, unemployment insurance, inventory, dealer personal property and other items, total taxes on cars reach 45 percent of the sales price.

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