Paper license plates — commonly referred to as temporary tags — are being phased out in Texas.
Beginning July 1, vehicle dealers will be required to install permanent metal plates at the time of purchase, said Wise County Tax Assessor-Collector Monte Shaw, whose office handles local vehicle registrations. Before, temporary paper tags were issued to vehicle owners, who would later receive their permanent plates in the mail.
The change stems from 2023 legislation aimed at curbing criminal activity associated with temporary tags. Media outlets — notably NBC 5 — have reported in recent years on how easily temporary tags could be printed and sold. In addition to enabling criminal activity, some of the tags have appeared on vehicles that would not pass safety or emissions inspections.
The law, HB 718, requires metal plates to be issued through dealers licensed by the Texas Department of Motor Vehicles. Dealers who have not signed on to the new state registration system by July 1 will not be able to complete motor vehicle sales transactions.
The change may be a challenge for some, particularly small dealers. Under the law, the state will issue permanent metal plates to dealerships who must use a state-run computer system to register the vehicles.
“We are holding our breath around here hoping everything goes as planned, but I certainly have concerns,” Shaw said. “I think small dealers will have a difficult time adjusting to the change.”
Shaw said his vehicle registration staff has attended multiple training sessions on how the program should work, but some dealers have not yet signed up for the state system. Just walking into the registration office with the paperwork, as they have done for years, will not work anymore. He said some small dealers seem reluctant to do the training and several just don’t have the expertise or help to do the technical work.
An official with the Texas Independent Auto Dealers Association, the trade group for used car dealers, said while the law was aimed at stopping illegal use of the paper tags, it has triggered hours of changes and study by the state, and at the county level and at dealerships.
Shaw said that large dealers like James Wood and Karl Klement have been using some form of the state computer system for some time, but he is worried about the smaller used car dealers. The TIADA magazine article said dealers should think of the state computer system as a virtual tax office and nothing more.
The new permanent plates will be delivered to individual dealerships by the state and not the local vehicle registration office. To help prevent fraud and theft, the plates must be kept in locked areas. The state will do regular dealership compliance audits.
The state will continue to distribute metal dealer plates for use on dealership owned vehicles as well as four new metal plates for specific usage. Those temporary plates can be used for test drives, loaner vehicles or transporting a vehicle from one dealership to another. Another plate is for out-of-state buyers and another is a temporary registration plate replacing the one-trip and 30-day permits.
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