O’Neill pre-files bill to apply trade-in tax break to pickup trucks

O’Neill pre-files bill to apply trade-in tax break to pickup trucks

PROVIDENCE – Sen. Edward O’Neill, of Senate District 17, representing Lincoln, North Providence and North Smithfield, pre-filed a bill last week that would give pickup truck owners the same tax break as those who buy or trade in regular automobiles.

The bill exempts the trade-in value of pickup trucks less than 6,000 pounds gross weight from sales tax with the caveat that they are not used commercially.

“Pickup trucks have become just another family vehicle, and it has been that way for a long time,” said O’Neill in a statement. “So to me, it doesn’t make sense that we aren’t offering the same deduction to someone who is exclusively using his or her vehicle for personal use just because it’s a truck and not a car.

“I believe the original idea behind the inequity is that there was a notion out there that most trucks are used for work or commercial purposes as opposed to a personal vehicle,” he said. “That’s certainly not true. People may choose a truck over a car for a host of reasons. There’s no real explanation anymore as to why the sales tax is applied one way to cars and one way to pickup trucks, and this bill would restore fairness to our tax structure in this instance.”

When someone purchases a car in Rhode Island and trades in his or her old one, the sales tax is calculated on the price of the new car, minus the value of the trade. But when purchasing a pickup truck, the same rules don’t apply. Sales tax on pickup trucks is currently based on the full price of the new truck without factoring in the trade value of the old vehicle.