Right now when you trade a car in for its value on a new or used car purchase the amount you get on the trade is totally exempt from sales tax. But that’s changing in 2020. Now only the first $10,000 of your trade will be used to avoid paying sales tax. Pete Sander, President of the Illinois Automobile Dealers Association, is worried about how it will impact car sales. He adds that car sales already contribute a big portion of the state’s sale tax revenue.
Sander says his group is lobbying lawmakers to change the law and will be working with them again in the spring session.