New cars are taxed 2.80% on 60% of their MSRP while used cars are taxed 2.89% on 60% of the MSRP with an annual deduction of 16.25%.
The Arizona Department of Transportation (ADOT) collects your VLT when you pay your annual vehicle registration renewal fees at the MVD.Anyone who resides in Arizona for seven months or more in a single calendar year are required to register their vehicle and pay VLT.
Calculating Arizona’s vehicle license tax (VLT) The Arizona VLT is a fluid tax rate that changes yearly with the age of your vehicle: New vehicles : 2.80% on 60% of the manufacturer’s base retail price for your vehicleUsed vehicles: 2.89% on 60% of an annual 16.25% deduction of your vehicle’s MSRP to account for depreciation.
Expert tip: You can use Arizona's VLT calculatorto find the amount you’ll owe when you renew your registration at the Arizona Motor Vehicle Division (MVD).
Use the table below as a guide to calculate your model’s VLT and see an example for a new car with a $20,000 MSRP in action:
VLT tax rate Percentage of your vehicle’s MSRP Example assessed value (based on $20,000 MSRP) Example taxable value (60% of assessed value) Example tax owedKey Takeaway The amount you pay in VLT will change each year you register your car in Arizona . The Arizona MVD offers a handy calculator in case math isn’t your strong suit.
Annual VLT and registration fees in ArizonaThe VLT is part of your annual driver registration fees as a resident and registered driver in the state of Arizona. Be prepared to pay the following potential fees when you renew your registration at your local MVD office:
$8 vehicle registration fee $4 title fee $1.50 air quality research fee $17 vehicle emissions testing fee (for your first year of registration) Vehicle License Tax (as calculated above) Arizona car sales tax Arizona vehicle license tax exemptionsMost Arizona residents who register a car must pay the annual VLT. However, there are numerous exemptions to paying the VLT based on who you are, where you work, and what you drive.
Here are some of the most common tax exemptions to paying Arizona’s VLT: Alternative fuel vehicle/electric vehicle owners Non-government emergency service personnel Vehicle used for a non-profit organization , school, or religious institution Recipient of social security income disability payments from the federal government Widow or widower Survivor of fallen first responder Survivor of fallen military member Indigenous American tribe member Specialized military exemption 100% disabled veteran exemption Vehicle purchased with VA grant Arizona registration requirementsArizona drivers must perform the following if planning to reside in Arizona for seven months or more during one calendar year:
Get an Arizona driver’s license Register your car with the Arizona DOTPart-time residents: These requirements apply to snowbirds and other part-time residents who only plan on residing in the state for a limited period of time. Figure out how long you’ll be residing in the state during a single calendar year to determine your registration requirements.
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RECOMMENDEDArizona doesn’t charge a personal property tax, as many other states do. The VLT is an "in lieu" tax for Arizona to still generate revenue off of vehicle purchases.
I’m a retiree who spends winters in Arizona. Do I need to pay the VLT?It depends on how much time you spend in the state. If you spend more than seven months per calendar year in Arizona, you’ll need to register your car there and pay the VLT.
Are you overpaying for car insurance? Compare quotes and find out in 45 seconds. 4.7 17k Ratings 5M+ Drivers Joined $600/yr Average Savings You might also be interestedJason Tushinski is an insurance writer with a background in journalism and over seven years of experience in freelance writing. Jason specializes in insurance and combines a wealth of skills obtained throughout the publishing industry to create useful, easy-to-understand content for car owners. Jason has written over 1,000 articles for Jerry on topics ranging from insurance company offerings to DMV processes to car model specifications. Before joining Jerry, Jason worked as freelance video content creator, news writer and editor for the Sun News Network, and researcher for CBC. His writing is published in Maclean’s and This Magazine.
Editorial Note: This article was written by a paid member of Jerry's editorial team. Statements in this article represent the author’s personal opinions and do not constitute advice or recommendations. You should consult with an insurance professional about your specific circumstances and needs before making any insurance decisions.
