Pennsylvania Car Sales Tax: Everything You Need To Know
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When purchasing a vehicle, there is more to consider than the price tag. There are fees, insurance, and car sales tax. Every state offers a varying tax rate, and Pennsylvania is no different. You might wonder - what is the Pennsylvania car sales tax? What can you anticipate paying when investing in a vehicle?
If you’re interested in learning more about the Pennsylvania car sales tax, you’ve come to the right place. Read on to learn more about the car sales tax rate, how to calculate the fee, exemptions to consider, and everything else you should know about the price. The more you know, the easier it will be to anticipate what to pay for your vehicle.
What Is The Pennsylvania Car Sales Tax Rate?
Cars are subject to sales taxes because, like boats or RVs, they are large personal properties that can be used on the highway. No matter what you purchase to drive on the road, it will be subject to sales taxes. Let’s focus on motor vehicles.
According to caranddriver.com, the Pennsylvania car sales tax is 6%. This price point matches the rate Pennsylvania offers for anything else subject to sales tax in the state. However, there are two exceptions - Allegheny county raises the tax an additional 1%, and those in Philadelphia should anticipate a 2% increase once registered.
The Pennsylvania Department of Transportation works as the collector of Pennsylvania sales tax. Buyers, leasing agents, and other sellers cannot utilize a vendor discount when the sales tax is paid during registration. Instead, the individual who collects and sends the tax to the department accesses this discount.
Sometimes, there are cases where the sales tax increases legally. Let’s discuss this situation so it doesn’t take you by surprise.
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Potential Sales Tax Increases
In Pennsylvania, the Department of Revenue can increase sales taxes on a vehicle through the Motor Vehicle Understated Value Program. This action will only occur if the selling price is set at a cost lower than the market value, targeting companies who sell to obtain lower sales tax rates.
The Pennsylvania state government is in charge of determining the fair selling price point on the market. Those who want to put their vehicle up for sale should check the number online before setting a price, or additional sales taxes could be applied to their car.
Let’s say you want to invest in a Pennsylvania vehicle. Is it possible to calculate the car sales tax for an accurate estimate in the preparation and saving process?
Calculating Pennsylvania Car Sales Tax
It’s helpful to have an estimate of what you might pay for a vehicle before putting any money down. Once the sales tax and other fees are added to the equation, it can very quickly move out of the initial price point. Luckily, it isn’t too tricky to estimate the car sales tax for your vehicle in Pennsylvania.
If you want to calculate an estimation for your car sales tax in Pennsylvania, here’s what you need to do:
- Locate the official price of the vehicle
- Multiply that number by .06
- Write down the final number
This solution is the estimated sales tax for your vehicle.
Once you have this number, all you need to do is add it to the price of the car. From there, you can tack on any additional fees and price points to consider for a rough estimate of the total cost for your vehicle. This number will help determine if you really can afford it.
As with any tax or fee, there are exemptions. Let’s talk about the individuals in Pennsylvania who might be free of paying this tax on their cars.
Are There Exemptions From Pennsylvania’s Car Tax?
At the moment, there aren’t many ways to become tax-exempt, especially when considering sales taxes on personal property. Nobody is exempt from the Pennsylvania car tax. If you think you might have a reason to be tax-exempt, reach out to your local DMV to see if an exemption is a possibility for your life.
The best way to get a partial tax exemption for your vehicle in Pennsylvania is to use the trade-in option for your vehicle. By trading your old machine for a new one, you will receive a tax exemption on the value of the older vehicle.
There are other fees to consider when investing in a vehicle in Pennsylvania. Let’s talk about them.
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Other Fees To Consider
Although the car sales tax is the biggest additional fee when investing in a vehicle, it is not the only one. There are several other fees you should consider when investing in a new car. You don’t want these items to sneak up on you during the buying process.
According to caranddriver.com, here are a few additional fees to consider when investing in a vehicle in the state:
- Title fees are around $50 per title
- Registration fees, close to $100 at their most expensive
- The plate transfer fee is around $10
You should add these to your estimate, aiming for the higher end of the scale to determine the maximum amount you might have to pay.
When picking the right car, it’s critical to take everything into consideration. The better prepared you are, the easier it will be to part with your investment when the time comes to sign papers and access your new machine.
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Final Thoughts
The Pennsylvania car sales tax is critical to consider if you’re purchasing a new car. Many people head into the process blind, unaware of the additional fees and costs added to the vehicle. These all serve a purpose, and the price point will vary drastically by the state the purchase occurs.
We hope this information was helpful! The more you know about your vehicle, the easier it will be to prepare and save for the purchase. If you choose to buy a car in a different state, consider that there will be varying sales taxes. Considering additional fees will make a difference before this valuable investment.
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