Loudoun Co. could lower rates on car tax, eliminate vehicle license fee
Few people are happy to receive a tax bill — Loudoun County in Virginia has taken a step that could reduce the amount residents pay on the unpopular car tax.
“It’s something that hits you twice a year, you kinda know that it’s coming, but you kinda forget about it,” said Matt Letourneau, chair of the finance committee for the board of supervisors, in a meeting on Tuesday. “Then the bill is always more than you think it’s gonna be. Nobody’s fault, it just is.”
In the midst of a budget surplus, the board is considering two forms of tax relief, including a recommendation to reduce the vehicle tax rate to $3.48 in fiscal year 2026, while leaving the general personal property tax rate at $4.15.
“We’re still in a high cost environment,” said Letourneau. “This tax, the personal property tax, is the most unpopular — we have far more complaints abt this than we do, even with real property tax.”
In Virginia, personal property taxes and real estate taxes are local taxes, which means they’re administered by cities, counties, and towns in Virginia.
If passed by the full board, the motion made by Sterling District Supervisor Koran Saines would direct County Administrator Tim Hemstreet to prepare a budget based on a real estate tax rate of 84.5 cents per $100 of assessed value.
“The decreased rate will have significant impact and help our residents,” said Saines. “And, ultimately, the goal is to have the rate higher for, and I’ll just put it out there, data centers.”
Letourneau said board members consistently hear from frustrated residents that they aren’t seeing a benefit from the county’s data center revenue.
“When you really get into the numbers, we know our tax rate would be much, much higher, like some of our neighbors if we didn’t have data center revenue,” said Letourneau. “If we are able to lower the vehicle personal property tax rate by 50 cents, really almost exclusively because of so much revenue coming in from the other personal property tax line item, that really illustrates the point and provides tangible relief to people.”
In addition to the proposed lowering of the auto tax rate, the committee voted to eliminate the $25 annual vehicle license fee for the upcoming 2025 tax year. Letourneau said he spoke with absent Chair Phyllis Randall, who said she would support the measure, when it comes before the full board.
“We’re running enough ahead of budget where we will have a very significant surplus, and we can, I think, easily afford to reduce the money that we’re collecting, in order to reduce this fee,” Letourneau said, of the license fee.