Missouri Cracks Down on Expired Temp Tags With a New Law
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Shopping for a new car is fun, but exhausting. There's a lot to take care of before the dealership hands over the keys. You need to finance your new car, purchase car insurance coverage, apply for vehicle registration, and get your license plates.
Depending on where you live, the whole car buying process might be somewhat simplified. That's because many states allow new car owners to pay sales taxes and order their new license plates right at the dealership. These costs can be rolled into your car loan, so you don't have to think about paying them separately. But this hasn't been the case in Missouri.
Why are expired temp tags common in Missouri?
Before driving off the lot, Missouri dealerships give car buyers temporary tags. These tags are only valid for a limited amount of time before they expire. Drivers are then expected to make a separate stop at their local Department of Motor Vehicles (DMV) to pay sales tax and order their license plates.
But, many drivers put off paying sales tax. They take their chances by driving around with expired tags. However, a new state law is going to make that more difficult to get away with in the future.
St. Louis Post-Dispatch recently reported on the prevalence of expired temp tags. Why don't drivers take the time to pay sales tax and order new plates? The simple answer is cost.
After buying a new vehicle, some drivers don't feel like they have the extra funds. Having to pay cash for car sales tax, rather than including it in a car loan, is a financial burden for some drivers.
You can be fined for having expired temp tags in Missouri, but it's a rare enough occurrence that many drivers feel like they can get away with it. The fines are also relatively inexpensive. Someone who purchases a $10,000 vehicle would have to pay almost $1,000 in sales tax. An expired temp tags fine is only $100 to $200.
How do expired temp tags hurt Missouri's roads?
In Missouri, a percentage of the vehicle sales tax goes directly to the state's Department of Transportation (DOT), which funds roadway and bridge maintenance. According to St. Louis Post-Dispatch, there could be as much as $26 million in unpaid sales tax. Without this much-needed revenue, the condition of the state's roads will continue to suffer.
According to a press release from Governor Mike Parson, "Missouri has the seventh largest transportation system in the nation but only ranks 45th in available revenue per road mile." Drivers who keep their temp tags indefinitely may hurt the state's bottom line.
Temp tags could soon be a thing of the past
Changes are taking place that will enable car dealerships to connect to the Department of Revenue's computer system. Dealerships can then collect sales tax at the point of purchase and drivers won't have to make a separate trip to the DMV.
In addition, many car buyers will be able to finance the sales tax along with their car loans. Spreading out the sales tax so it’s not a lump sum payment makes it easier for consumers with budget constraints. These changes are a win-win situation for both drivers and the state.
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