While Forsyth County resident Karen Barrett said the new ad valorem title tax that goes into effect March 1 didn’t influence her recent car purchase, she said she believes the reform will save her money.

Motor vehicles purchased on or after March 1 will be exempt from sales and use taxes and the annual ad valorem “birthday tax,” and instead there will be a one-time title fee of 6.5 percent when the vehicle is bought. The upfront fee will also apply to private sales between individuals, new residents to Georgia and vehicle ownership changes. The standard $18 title and $20 registration fees still apply. The current sales tax is 7 percent.

Hall County Tax Commissioner Darla Eden is trying to educate residents about the new law now. Her office is receiving hundreds of calls a day about how the fee will work, and Eden said she has set up a call center just to handle the volume. Her office staff is undergoing training to help taxpayers who may not have heard about the tax reform or are unprepared to pay the ad valorem upfront.

“I don’t feel there’s been a lot put out at the state level,” Eden said.

Barrett said she heard about the change in current law before she went car shopping. She bought a 2013 Honda Accord on Friday for $21,000 and will pay a title fee of $1,379. She said she’s happy about the tax reform.

“It’s going to save on your ad valorem in years to come,” she said.

The title ad valorem tax is based on the value of the car, not price of the vehicle. Cars that were purchased between Jan. 1, 2012, and March are able to opt in to the new system before the end of the year and won’t pay the annual ad valorem tax.

The county tax office will compare the actual sales tax paid and the ad valorem from the previous year and the title fee that would be due. If the amount already paid is greater than the title fee, then no money is due. If the title ad valorem tax is more, then the difference is due.

New residents must pay at least half of the title fee at the time of initial registration, and the other half must be paid within 12 months. Vehicles that transfer ownership between family members or are inherited by family members before March 1 can stay in the old system and pay the yearly “birthday tax” or opt into the new system and pay .5 percent of the new title tax.

For private sales between individuals on or after March 1, the new title fee is due when the new owner registers the car.

“I think this will be a shock to some people,” Eden said.

Eden said she encourages residents to come to her office near their birthday and not right when the law takes effect, except if their birthday is in March.

The new title fee can be financed the same way the sales tax was, said state Sen. Butch Miller, R-Gainesville. Miller is also general manager of Milton Martin Honda in Gainesville. Replacing the birthday tax was part of a larger reform package designed to cut taxes, Miller said.

“There will be some growing pains, but ultimately it will save consumers money,” he said.

The title tax will go up to 6.75 percent in 2014 and 7 percent in 2015. State and local governments will split the funds from the new fee, with local governments guaranteed a base amount of $1 billion, plus 2 percent growth per year through 10 years. The local tax share starts at 43 percent in 2013 and rises to 72 percent in 2022.

The new law includes all passenger vehicles, motor homes, motorcycles, straight-trucks and truck-tractors.