How is state tax paid on car lease? U buy $25k car, u pay state 7% sales/excise tax. U lease car, u pay tax on monthly lease payment. Say $400 payment. Does lease co, like Toyota lease pay state 7% of 400 each month? Or does lease co pay entire tax due based on lease term upfront? Lease is 36months at 400 or 12k or so. So lease co pays 7% of 12k? When lease is over u walk away. So why pay sales tax on full value of car? Car is worth 25k. Approx. ur lease payments are 12k. So u pay tax on ur use, of 12k?
Need to know what state you’re talking about.
Here in NH there is no sales tax. But we do have a excise tax that is paid every year when the vehicle is registered. NY only has a sales tax.
I can’t help you much on the Leasing (maybe someone who leases knows). I’ve NEVER EVER leased a vehicle in my life and NEVER EVER will.
In NY you pay sales tax on the negotiated price of the car minus the negotiated residual ,
It varies by state. You should go directly to your appropriate state agency involved with your question. I’m sure your state house operator will be able to direct you to the appropriate office.
Or, your state probably has a website outlining its tax policies dealing with the issue.
There u go. Sales price/resid price is taxable amount. Or depreciated amount. Which is lease price. We all do pay sales tax. We pay license fees. State title fees. U buy new car u pay sales tax. U sell car in 2yrs and new buyer pays excise tax on car value at time. States like to say the 2nd owner is not paying sales tax again. They are paying a tax with a different name.
@MikeInNH Like NH, OR has no sales tax. I purchased a new vehicle in 2010 for $17,000. Sales tax at 7% would have been $1,190 yikes! That is over half my State income tax that year. Our State income tax runs less than 5% in my bracket. What is the % excise tax for vehicle registration in NH? Non commercial vehicle registration in OR is a flat rate of $80 for 2 years. There are no vehicle inspection requirements with the exception of 2 Municipalities that require emission checks. The concept of charging sales; excuse me excise tax on a vehicle every time it is resold infuriates me. I consider it State sponsored robbery!