How is the Motor Excise Tax determined?

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.

Figures are the manufacturers’ list prices for vehicles in their year of manufacture. Present market value, price paid, or condition, are not considered for excise tax purposes. The excise tax law (M.G.L. c.60A, s.1) establishes its own formula for valuation for state tax purposes whereby only the manufacturer’s list price and the age of the motor vehicle are considered. The formula is as follows:

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.

Excises are prorated on a monthly basis. If a motor vehicle is registered after the beginning of any calendar year, no excise will be imposed for those months, if any, which have fully elapsed before the vehicle is registered. If a vehicle is registered for any part of a month, however, the excise will be due for all of that month. The annual excise due on a car registered after January 1 will be reduced, therefore, by one twelfth of the full year’s excise for every month prior to the one in which the vehicle was registered.