OK Senate advances bill changing vehicle tag law

TULSA — The Oklahoma Senate has passed a bill to fix a problem that costs the state millions of dollars a year, much of which should be going to help fund education.

Oklahoma is one of only eight states where a license plate stays with the vehicle, rather than the original owner, when it’s sold.

Oklahoma Used Motor Vehicle and Parts Commissioner Terry Shreve tells KRMG his conservative estimate is that the practice costs the state between $35 and $40 million a year in sales tax, excise tax, and registration fees.

By law, 36% of that money would go to help fund education in Oklahoma.

The simple fix, Shreve told KRMG Tuesday, is to have the tag stay with the original owner, rather than with the vehicle.

“This is not a tax increase,” he said. “This is not a fee increase. This is not a regulation increase. These millions and millions and millions of dollars that Oklahoma is not collecting, that money only comes from tax cheats.”

Hundreds of vehicles each day change hands in the state under a practice called “title jumping.”

The buyer has the seller sign the title, without dating or notarizing it.

They then sell the car, possibly after driving it for several months, putting the new buyer’s name on the title as if they were the original buyer.

They avoid paying taxes or fees, and when the new owner goes to register the vehicle, it appears the sale happened within the last 30 days.

Another problem is that someone driving a car they bought with tags that haven’t expired could blow through a turnpike gate, and if the violation was captured on camera, the citation would go to the registered owner - who may have sold the vehicle months earlier.

The change, Shreve said, “will not cost the honest citizen of Oklahoma one additional penny in any fees or anything that they pay every year.”

Additionally, there would be no need to add to the existing bureaucratic or administrative structure of the state, so there’d be no additional burden on the state budget.

The only start-up costs would be an educational campaign to inform the public of the change, Shreve said, and after that the revenue would simply continue to come into the state’s coffers.

“This is a gift that keeps giving forever,” he told KRMG.

The Senate passed SB1339 by a vote of 35-7, it now goes to the House.