Arlington County has not required a tax decal on cars since 2019, but that has not ended the annual $33 per-vehicle decal fee — yet.
Also known as a “motor vehicle license fee,” the yearly charge is assessed for all cars kept in Arlington regardless of their value, unlike another annual vehicle expense, the Vehicle Personal Property Tax. But the former is now on the way out.
The County Board is set to vote Saturday to eliminate the $33 fee, following the approval of the new Fiscal Year 2023 budget last month. The lost revenue is being offset by “a portion of the additional personal property tax revenue projected due to rising vehicle assessments,” according to a report to the Board.
More from the report:
The MVL fee was originally known as the decal fee due to the previous requirement to display a decal on the windshield of all vehicles having situs in Arlington County as proof of payment of the annual MVL fee. The fee was intended to help cover the cost of compliance efforts related to the filing and payment of vehicle personal property taxes. In FY 2008, the initial fee of $25 was increased to $33, the maximum amount allowed per Virginia Code. Due to the automation of compliance efforts in FY 2019, the decal requirement was repealed and the fee remained payable with vehicle personal property tax bills due each year on October 5th.
“Since this flat fee of $33 ($18 for motorcycles) is applied to all vehicles each year, households with cheaper and older cars are burdened the same as affluent households owning more expensive vehicles,” the report goes on to say. “The removal of this fee, with revenue offset by the more progressive tax (personal property tax), continues the County’s priority of more equitable tax burden in our community.”
Currently, Falls Church, Fairfax County and Prince William County each collect a $33 annual license fee, like Arlington, while Alexandria does not collect the fee.