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Buckingham County residents will get more tax relief on their personal property this year. That comes due to this week’s vote by the board of supervisors, as they set the annual Personal Property Tax Relief (PPTR) percentage during Monday’s meeting. 

What does that mean? In Virginia, cities and counties follow what’s called the Personal Property Tax Relief Act. The state law orders that all localities have to subsidize at least a portion of the taxes owed on the first $20,000 of a vehicle’s assessed value. Each year, the city or county sets their PPTR rate to do this, reducing the final bill owed by a resident. 

For example, let’s say a city or county sets the PPTR rate at 24% of assessed value. That means for a car assessed at a value of $20,000, the resident would owe $684. Then let’s say the next year, the city or county sets the rate at 35%. If the vehicle’s value remains the same, that resident would only pay $585, saving nearly $100. 

Where does tax relief money come from? 

So now comes another question. Where does this money come from, to reduce the tax rate? The Commonwealth gives each city and county a set pot of money for tax relief. Specifically, the General Assembly allocates $950 million each year. That’s set in Section 58.1-3524 of the Virginia Code. No more, no less. That pot of money is then divided up among the cities and counties. The amount of personal property tax payments made throughout the state is broken up by percentage. 

Each city or county then gets a similar percentage from the $950 million. Let’s say a county’s personal property tax payments added up to 10% of all personal property payments in Virginia. Then that county would get 10% of the $950 million for the year or $95 million. Because the $950 million allocated by the state doesn’t change from year to year, it doesn’t fully cover the cost of personal property taxes owed. But it does provide some relief. 

Translating for this tax year 

So what does that mean for Buckingham? County officials then take the amount received from the state and determine how much of the personal property taxes that will cover for a given year. That’s the tax relief rate. 

Last year, for example, the personal property tax relief in Buckingham was set at 27.68%. This year, supervisors agreed to increase the rate to 28.17%. How will that affect you? Let’s say you have a car worth $20,000. Your personal property tax comes in at $810. Last year, the tax relief saved you $224.21. Under this year’s rate, you’ll save $228.18.