The Rhode Island car sales tax is 7% on all vehicle purchases, new or used. This motor vehicle tax is applied to the purchase price or fair retail value of the car.
City and county governments in Rhode Island are not allowed to levy any local tax in addition to the state sales tax of 7%.
Gifted vehicles and out-of-state purchases are exempt from the Rhode Island sales tax.
The Rhode Island sales tax applies after trade-in credit, but before rebates or incentives.
Rhode Island’s statewide sales tax is 7%. It is one of the only states that doesn’t allow local governments to collect sales tax, so you’ll pay a 7% sales tax no matter what county or city you live in.
Exemptions from Rhode Island car sales tax
There are a few circumstances when a vehicle is exempt from the Rhode Island car sales tax, including the following:
Gifting a vehicle to an immediate family member
Gifting a vehicle to a non-immediate family member
, for example, you’ll get a $2,000 credit off the new car sticker price of $27,740. You’ll only owe the 7% sales tax on $25,740 of the purchase.
Rebates and incentives are still subject to vehicle tax, so keep that in mind when calculating the total cost of your new car. This means you will pay tax on the full amount of the vehicle before the incentives and discounts.
How to calculate sales tax on a car in Rhode Island
When buying from a dealership:
Multiply 0.07 by the new vehicle’s purchase price after any trade-in credit is applied but before any rebates and incentives.
How to estimate Rhode Island tax, title, and registration fees
We said earlier that there are added expenses when purchasing a car in Rhode Island. We’ve talked about sales tax, but you’ll also have to pay title and registration fees, plus other fees for transferring plates and a documentation fee.
Here’s what some of those costs look like:
Expense
Average cost
Sales tax
7%
Vehicle registration fee
Min. $45 (based on vehicle weight)
Title fee
$52.50
Plate transfer
$52.50
Documentation fee
Max. $400
You can get more information on the registration and title fees on Rhode Island’s
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FAQ
How much is the sales tax on a used car in Rhode Island?
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Regardless of whether you’re purchasing a new or used vehicle, the sales tax on vehicles in Rhode Island is 7%. However, for used cars purchased from a private party, the sales tax will be calculated based on either the purchase price or the NADA Clean Retail book value—whichever is greater.