Motor Vehicle Excise Tax & Abatements
Motor Vehicle Excise Tax
What is excise tax?
Pursuant to Ch. 60A of the Massachusetts General Laws, if you own a registered motor vehicle or trailer, you have to pay a tax, called a motor vehicle and trailer excise, each year.
Every motor vehicle and trailer registered in Massachusetts is subject to the motor vehicle excise unless exempted. It is important to note that every motor vehicle, whether registered or not, is subject to taxation either as excise or personal property.
How do I compute my bill?
An excise at the rate of $25 per one thousand dollars of valuation (effective 1/1/81) is levied on each motor vehicle. Information on the value of a motor vehicle is accessed electronically through a data bank complete with valuation figures. Different sources provide the valuation figures depending upon whether the motor vehicle is an automobile, a truck, a motorcycle, or a trailer. For example, automobile valuations are derived from figures published in the National Automobile Dealers Association Official Used Car Guide (NADA), to which the Registry has electronic access. Most public libraries have copies of NADA and other motor vehicle official guides.
Payments
Payment of the motor vehicle excise is due 30 days from the date the excise bill is issued (not mailed). A person who does not receive a bill is still liable for the excise plus any demand and interest charges accrued. Therefore, it is important to keep the Registry and the post office informed of current name and address changes so that excise bills can be delivered promptly. It is the responsibility of the owner to contact the Tax Collector if he/she has not received a bill.
How much is excise tax?
The amount of tax you pay depends on two things:
1. The age of the vehicle
2. MSRP (manufacturers suggested retail price)
Percentage Break Down:
In the year preceding the model year (brand new car released before model year) 50%
In the model year: 90%
In the second year: 60%
In the third year: 40%
In the fourth year: 25%
In the fifth and succeeding years: 10%
Every motor vehicle owner must pay an excise tax based on valuation of at least ten percent of the manufacturer’s list price; thus, owners of vehicles older than five years should have a fixed excise tax bill for succeeding years of ownership. Even though an owner may have applied for an abatement that may reduce an excise tax bill, no excise shall be less than $5.
Abatements:
An abatement is in order in the following cases:
When the motor vehicle is sold and the registration is cancelled or when the vehicle is traded for another vehicle.
(Documents required:Bill of Sale or new car invoice showing trade-in AND Massachusetts Plate Return Receipt)
When a registrant and motor vehicle are transferred to another state or country with proof of registration in such state or country AND proof of cancellation of registration in Massachusetts.
When a motor vehicle is overvalued.
When there is a subsequent registration of the same vehicle in the same year by the same person.
When the vehicle is stolen and notification of theft within 48 hours is given to police and certificate of registration surrendered not less than 30 days after the theft and certificate from the Registry verifies the same.
A proportionate abatement of the excise may be granted if any of the above conditions is met and the application is properly and timely filed.
Forms for applying for an abatement or refund are available HERE, or at the Assessor's office.
Applications for abatement will be considered timely filed if received by the Assessors within 3 years after the excise tax was due, or one year after the excise tax was paid, whichever is later.
Abatements are prorated monthly. If a vehicle is registered for any part of a month, the excise will be due for all that month.
You are not entitled to an abatement:
When you cancel your registration and retain ownership of your vehicle.
If you move to another Massachusetts city of town during the same calendar year.
If you cancel your registration and sell your vehicle in the month of December.