Car dealership asking to pay more for tax post contract signing


#1

I live in Queens county in NY and I negotiated for purchase of a brand new car in different county in NY. I made it clear that I need to pay Queens county tax which is higher tax rate than the county I purchased the vehicle. When we were negotiating we discussed the prices in out the door to include all but plates. We agreed to price, I paid deposit, and signed contract.



2 days before car pick up date, dealer calls and asks me to bring in extra to pay for difference in taxes because they just noticed that salesman was using wrong tax rate.



So pretty much they are asking me to pay for their mistake and I told them no I’m not paying that. You pay that out of your pocket. They haven’t responded yet.



Few key notes:

1. I have signed contract

2. Car is not in my possession yet



Question:

1. Am I in legal right here to not pay for the difference in tax and force dealer to pay if they continue to be unethical and attempt to have me pay for the difference?



Thanks for any help and opinion.


#2

You can not force the dealer to pay, but they may decide to do so.
You can, I think, back out of the deal, but that’s it. If the dealer won’t move on this, then your choices are to pay the extra tax, or to walk away from the deal. Do you really think you will be able to get a better deal elsewhere? If so, will it be worth the grief?


#3

Am I in legal right here to not pay…?

If you want legal advice, you need to ask a lawyer. I don’t think you have proven the dealer has done anything unethical. Mistakes are not unethical. They are mistakes, and we all make them.


#4

I don’t think this is necessarily unethical. It appears as if they’re still offering you the same pre-tax price. Did they not break out the pricing for you to double check?

Unethical, IMO, is what the dealership here tried to do to me with my Mazda. We had a prenegotiated deal that I was taking advantage of, and they agreed to that price (which was supposed to include everything but tax, title, registration, and dealer doc).

Then they hand me a contract with that pre-negotiated price listed on it and a total. I knew right away that total was way too high, and asked for a breakdown of the total.
Sure enough, they added tax, title, license, dealer doc, and then the better part of $1000 for paint and fabric protection. They tried to get me to sign a contract while hiding that package in with taxes. That is unethical, IMO, trying to charge a customer for something while hiding it…

I threw the contract back at them and made them take it all out (despite their cries of “we’ve already paid for it to be applied!”).


#5

Our Forum certainly is moving more and more into the legal advice and ethical conduct arena. Unless the one responding is trained in the law (and that paticular type of law) you will not be getting any advice that “you can take to the bank”. Same but different thing goes with the questions on ethics that we get, you will simply be getting peoples opinion.

Now ask for advice on how to fix your car and the information approaches the level of fact.


#6

Exactly

When I ordered my new car, back in June, after I returned home I noticed that the bottom-line price on the sales order was impossibly low. We all like a good price, but this price did not seem possible, given the base price of the vehicle plus the cost of the options that I had specified. I had already done pricing online and with a couple of other dealerships, so I knew what constituted a good price. This price was beyond good.

I called the saleswoman on the phone, and told her to double-check her figures and get back to me. As it turned out, because of some distractions she had failed to add the cost of the options, which amounted to about $2.5k, even at a discount.

I suppose that I could have insisted on the “deal”, but this woman–from whom I had previously bought two cars and who is a very decent person–would have had to pay the difference in price out of her own pocket. Since bad karma is something that I do not want to deal with, I simply told her that I expected an extra-good deal for my honesty.

She came through for me, because the real bottom-line price still turned out to be several hundred $$ lower than any of the other prices that I had negotiated. I probably could have legally demanded the truly incredible deal that I was first offered, but I am not the kind of person who wants to take food off of someone else’s table, or to endanger their job security, and I do not want to benefit from someone else’s simple mistake.

Mistakes happen, and how folks deal with them reveals much about their personality.


#7

I have bought new cars in another state and paid tax to the state where I live, where the new cars were initially registered and would think too that your county situation would be similar.

If you have a mutually signed contract with a final price, then that is your price. The dealer, if they have any inclination to have ethical behavior and a desire to maintain good will among their customers should eat any difference and learn for next time. It’s their job to train their people; not your responsibility to account for their error. This can’t be much money; it would be interesting to know why they are risking losing a customer permanently for a few dollars. I would not pay and if they won’t eat the difference you can complain to your lawyer or walk. Walking is easier.


#8

Thanks for everyone’s input and opinion. I was and still am pretty agitated about this situation. I didn’t intend my post to go into legal or ethical arena to seek legal advice. I would consult a legal professional for that. What I should have wrote “Am I in the right” and “continue to be stupid”.

My frustration is added on with fact that the contract went through 4 people over period of 3+ days before they figured out tax was wrong (salesman, sales manager, business manager, and secretary). Not to mention the fact that I told them about tax ahead of time when we were negotiating… Plus they had my copies of my license, registration, and insurance at the start. We even had small talks about the town I came from because the sales manager used to live around there.

I’m not trying to take advantage of dealership of their mistake on something that’ll cost them thousands of dollars. Hell it’s not even in mid hundreds of dollars. Yet they want me to pay for that cost out of my pocket…makes more sense to me if the salesman who screwed up pays out of his pocket…


#9

So they just lost $5? Maybe $10? :stuck_out_tongue:


#10

Stop whining…Tax laws governing motor vehicles are COMPLEX. When you buy a vehicle in one tax district and take delivery in another tax district, it can REALLY get difficult…The dealers hands are tied by the law. It’s not realistic to expect the dealer to pay YOUR sales tax…So he made a paperwork mistake, so what??


#11

If you agreed on a price and were open about the tax difference then hold your ground. Chances are they have already titled the car in your name and if they don’t sell it to you, they will have to sell it as used (and sell it for ~20% less than what you negotiated with them). The tax will likely come out of the sales rep commission and you’ll have provided him/her with a valuable learning experience.


#12

Probably a few more than that… it included what was basically a scotchguard that I can say for a fact has worked well…

But probably not much over $50. :slight_smile:

I just shudder to think at how many people don’t have good enough math skills to catch them on that… there are probably plenty of people suckered into paying for it without even realizing it…


#13

You negotiated the price of the car. The tax is non-negotiable. Pay the tax.


#14

Its within same state and it’s within neighboring county. Dealers in these two counties do ton of business in both side (Nassau and Queens). Taxation for us in NY for new vehicle sales is not complex nor difficult to get the tax number right.

I’m not expecting dealer to pay my sales tax however I expected to and did negotiate the total price include EVERYTHING but plates. If they made the mistake on tax rate, that means we negotiated over the wrong price in first place. Is that hard to understand?

Let’s put it this way. You made a business deal for an inventory and you negotiated the price to include EVERYTHING. Based on that price, you agreed to buy it and signed a contract. After you signed and agreed to pay X amount, they come back and say oops I screwed up. I had wrong amount for category A when we negotiated. Can you pay me Y dollar more for the difference because I made the mistake?

Are you telling me you are going to say OK, I’ll pay for your mistake? Or will you ask them to eat the cost because they made the mistake and cost isn’t outrageous that you are taking advantage of them. If not that, will you ask to re-negotiate the deal because price you thought was the total price was actually not the total price.


#15

If I was the dealer I’d sell you the car and let you handle getting it registered, titled, etc. You will pay the sales tax then. So, it is a wash. Pay the dealer the proper sales tax, or do it yourself when you register the car. You won’t be able to pick up the car and drive it until you have the plates whichever way you choose to go.


#16

I see that people keep saying I negotiated over the price of the car. That is not true. I actually negotiated over the price to INCLUDE ALL but license plate fee. Because there are so many fees dealers can charge that I didn’t want to haggle over each fee individually. For example I didn’t want to haggle over $50 fuel fee, $80 dollar dealer doc fee, $75 dealer inspection fee, etc. while haggling over the price of car itself as well.

Why should I haggle individually when I can haggle over total sum which is same anyway. Let’s say I haggled 20 bucks off fuel fee, 50 bucks off dealer doc fee and 50 off dealer inspection fee to cover some of taxes I needed to pay. Is that not same as just haggling to take 120 bucks off the total price which includes all?

Taking this logic step further, let’s say that I did negotiate and we signed to take 120 bucks off the total price to include all. Then they come back later to say they screwed up so can you pay me? You need to pay us 20 dollar more.

Should I care where the mistake was made? Oops fuel fee was 70, not 50. Oops dealer doc fee was 100 not 80. I negotiated over the price to include all and while I am responsible for taxes. By negotiating the price to include all, taxes were factored in there regardless of rate they used.

I should iterate I’m no means by far taking any advantage of some paperwork mistake that dealer made that I’m walking away with extra thousands or even hundreds of dollars in my pocket. The amount I’m talking a cost of smartphone and my anger is over the principle of what we negotiated on which is the TOTAL PRICE.

Bottom-line is that for them to come back later when we negotiated over the total price and say pay X dollar more means they were not negotiating with me on correct price. Whether that X dollar was because they made the mistake on tax rate or they screwed up on one of their fees doesn’t matter to me.

Anyway, dealer ate the tax difference (not even talking hundreds of dollars here) and transaction gone through without problem. They did apologize for the screw up.

EDIT: I should also say that I can’t take my car off the lot unless I have the temporary registration on the car and that means I need to pay my taxes and fees for registration, plates, and all that stuff before I can drive the new car off the lot.


#17

The ones they probably easily screw over are the “monthly payment” buyers and/or the “I need a new car 2 days ago” buyer. they’re so eager to get a vehicle so they don’t even bother to look at the papers they sign and just sign sign sign, then sign some more. Then they get home and finally look the contract over and realize they just legally got molested for tons of extra money. And I don’t mean the “I bought a BMW/Acura/Mercedes/Porsche/other high end vehicle, can I use 87 octane even though it calls for 91+?” kind


#18

tell them you mentioned it to them that you lived in a different area BEFORE you signed the paper work. If they want to make the sale, then they need to flub some numbers to make it match the price you negotiated for.


#19

I did. In email and verbally at least four five times before signing. Plus they had copy of my license and all the info on trade in. He’ll we even had small talks about area I live in… before we ainged


#20

EDIT: I should also say that I can’t take my car off the lot unless I have the temporary registration on the car and that means I need to pay my taxes and fees for registration, plates, and all that stuff before I can drive the new car off the lot.

In my experience, that isn’t necessarily true. They can give you a temporary tag without taking care of the actual registration. This is how it worked when I bought a new motorcycle out of state.