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NBC 10 I-Team Exclusive: Governor wants RI's car tax to hit the road

Gov. Gina Raimondo tells the I-Team that it's time for Rhode Island to eliminate the car tax.

The NBC 10 I-Team has been investigating Rhode Island's car tax crisis for months. Now, the state's new governor tells the I-Team she would like to see the tax hit the road.

"We need to get ourselves to a place where we can eliminate the car tax," Gov. Gina Raimondo said Tuesday.

Raimondo said her plan is to work with cities and towns to help them save money on big costs like pensions and health care. She hopes municipalities can then pass those savings onto taxpayers by reducing, or even eliminating, the car tax.

But she cautioned that plan will take time, and the final decision lies with cities and towns.

When asked if the car tax could be eliminated during her time in office, Raimondo said, "I can't answer that, because the honest answer is, what I'd like to see is, I'd like to see it reduced."

Vehicle values are set by the state, but each city or town sets its own motor vehicle tax rate independently. Each community also exempts a different amount of the vehicle's value from tax, ranging from $6,000 in Narragansett to just $500 in Providence.

House Speaker Nicholas Mattiello had a different take, telling the I-Team that reducing or eliminating Rhode Island's car tax is unlikely to ever happen. He said cities and towns rely heavily on the income from car taxes since losing municipal aid from the state, and that's not likely to change.

"Realistically, that's probably not going to happen," Mattiello said. "The reality is we're probably not going to do anything."

What about changing the way cars are valued on your tax bill? Right now, the state uses the National Auto Dealers Association (NADA) clean retail value, the highest possible price for used cars.

Several legislators, including state Sen. William Walaska and state Rep. Joe McNamara, have introduced bills to change the law to trade-in value. But after years of introducing the same legislation, they've had no success.

Mattiello said changing the way cars are valued wouldn't solve the real problem.

"Municipalities will just raise the rate, because ultimately they're trying to plug a budget hole," he said.

But Raimondo was more hopeful.

"The great day in Rhode Island is when mayors can say, 'The economy is good and we've reduced our expenses. We're going to cut the car tax in half, or we're going to eliminate it.' That's what we've got to keep our eye on," she said.

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