I would check into that, that seems in absolutely no way legal to me. Sales tax is based on the price of the sale, not made up numbers.
That's one good thing about SC. You pay $60,000 or $600 for a car, you pay a % on the sales price... up to a MAXIMUM of $300! However, we do pay a yearly property tax on cars which sucks, but if you own old stuff it's only $50/yr or so.
Wow, so I looked it up... you gotta be fricken' kidding me!
http://www.dmv.ri.gov/registrations/tax/index.php
Vehicles 30 Years and Older
Dealer: Sales tax is 7% of the purchase price
Private Party: Sales tax is 7% of Nada Clean Retail book value or purchase price, whichever is greater.
So a dealer can pay 3K for a vehicle, pay 7%, you pay, say, 5K for it, but NADA says it's worth 12K and you have to pay tax on 12K? Wow, I know what state I'm never moving to...
...So I couldn't help myself... for giggles I looked up a 67 Camaro (I figured they'd be high). Lets say you bought a decent project car for 5K, not too uncommon... acording to RI DMV you would have to pay tax on 23K. Wow. That should be illegal.