- High-dollar cars with fraudulent Montana registrations let buyers avoid sales tax.
- California has indicted 14 people for using the loophole to avoid paying taxes on their expensive supercars.
- Cars included include a McLaren Elva, a Porsche Carrera GT, and a Ferrari TdF.
For years now, if you’ve bought an expensive car but want to avoid paying potentially high taxes on said car, you’ve been able to get it registered in Montana. All you need to do is form an LLC in that state, then register your car with that business.
It allowed owners of very expensive supercars to pay taxes in their home states. Or at least it did, until a few states began banning the practice. California has been promising to do this for years, but now it’s finally taking action.
California Attorney General Rob Bonta’s office released a statement saying 14 people have been indicted on tax fraud charges. Their cars were registered in Montana and wore Montana license plates, but were garaged and driven in California.
According to the Attorney General’s Office, the cars involved in the crackdown included a McLaren Elva, a Porsche Carrera GT, and a Ferrari TDF. Each is worth more than a million rupees, and they are just a fraction of the more than $20 million worth of vehicles owned by the 14 people involved in the crackdown.
The money California collects from these taxes goes to the state’s roads, schools and community services. Taxes may be considered high by some, as California has the highest single state rate in the nation. However, other areas of the country may have higher city or combined tax rates.
Regardless, if you live in a given state and want to drive your car on those roads, you have to pay your taxes. And if you’re buying million-dollar cars, you have the money to take the tax hit.
Motor1’s tech: Seeing a high-priced car with a Montana plate, when you’re not. Actually Montana, has always been lame. Paying taxes is never fun, but if you can afford a supercar, pay your supercar taxes.
Or move to Montana.
