Loudoun Co. could reduce vehicle tax rates, eliminate vehicle license fees

Few people are happy to receive a tax bill — Loudoun County in Virginia has taken a step that could reduce the amount residents pay for the unpopular car tax.

“This is something that happens to you twice a year, you know it’s coming but you kind of forget about it,” Matt Letourneau, chairman of the oversight board’s finance committee, said at a meeting on Tuesday. “Then the bill is always more than you think. “It’s no one’s fault, it just is.”

Amid the budget surplus, the board is considering two types of tax cuts, including a proposal to reduce the vehicle tax rate to $3.48 in fiscal 2026 and leave the general personal property tax rate at $4.15.

“We’re still in a high-cost environment,” Letourneau said. “This tax, the personal property tax, is the most unpopular tax; we have more complaints about it than even the property tax.”

In Virginia, personal property taxes and property taxes are local taxes, meaning they are administered by cities, counties, and towns in Virginia.

The motion, made by Sterling County Supervisor Koran Saines, if passed by the full board, would instruct County Executive Tim Hemstreet to prepare a budget based on a property tax rate of 84.5 cents per $100 of assessed value.

“The rate of decline will have a significant impact and will help our residents,” Saines said. “And ultimately the goal is to get the rate higher for data centers, and I’ll put that out there.”

Letourneau said board members constantly hear from frustrated residents who see no benefit from the county’s data center revenue.

“When you really look at the numbers, we know that if we didn’t have data center revenue, our tax rate would be much, much higher than some of our neighbors,” Letourneau said. “If we can lower the vehicle personal property tax rate by 50 cents, that’s actually because of so much revenue coming almost entirely from other personal property tax items, that really makes the point and gives people tangible relief.”

In addition to the proposal to lower the auto tax rate, the committee also voted to eliminate the $25 annual vehicle license fee for the upcoming 2025 tax year. Letourneau said she spoke with Mayor Phyllis Randall, who was not in attendance, and that she would support the measure when it comes to the full board meeting.

“We’re running far enough ahead of budget that we’ll have a very significant surplus, and I think we can easily afford to reduce the amount of money we collect to reduce that fee,” Letourneau said. license fee.

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