Dealer sales: price minus trade-in
When a registered dealer sells the car, the sales tax rate is 6.25% and it is based on the sales price minus the trade-in amount.[1] A manufacturer rebate applied at the time of sale is treated as a cash discount and is not taxed; a rebate paid to you after the sale does not reduce the tax.[1]
| Case | Tax | Share of price |
|---|---|---|
| $36,000 car from a dealer, $9,000 trade, $1,000 rebate | $1,625.00 | 4.51% |
| $36,000 car from a dealer, no trade | $2,250.00 | 6.25% |
| Private sale for $8,000, book value $10,000 | $625.00 | 7.81% |
| Private sale for $12,000, book value $11,000 | $750.00 | 6.25% |
Private sales: the book value rule
When a car is sold casually, not by a dealer, the use tax is 6.25% of the greater of the actual price or the vehicle's clean trade-in value from a standard guide, and no trade-in reduces it.[1] Reporting a low price therefore does not lower the tax.
Bought out of state?A car bought elsewhere and brought to Massachusetts within six months owes use tax, unless you paid at least 6.25% to a state that gives Massachusetts the same credit. The tax is due by the 20th day of the month after the purchase.
Massachusetts also bills a yearly excise on every registered car; see the Massachusetts vehicle registration fee page.
Compare states on the car sales tax calculator, include the tax in a budget with the car affordability calculator, or see the yearly total on the cost of owning a car calculator.
Frequently asked questions
What is the sales tax on a car in Massachusetts?
6.25%, statewide, with no local add-on.
Is a trade-in deducted from Massachusetts car sales tax?
Yes at a registered dealer; not in a private sale.
How is sales tax figured on a private car sale in MA?
6.25% of the greater of the price you paid and the car's clean trade-in (book) value.