Motor vehicle excise tax is assessed on a calendar year basis on all vehicles and trailers registered in the Commonwealth of Massachusetts, unless they are exempted under the provision of Chapter 60A of the Massachusetts General Laws. The rate of taxation is $25 per thousand dollars of valuation, and the value is based on the manufacturer’s list price when the vehicle was new.
The list price is depreciated annually by a statutory percentage, until the vehicle or trailer reaches five years of age. At that time, the valuation will have reached 10% of the list price. As long as the vehicle is registered, the valuation will remain at 10%, despite the condition or utility of the vehicle.
Excise tax is apportioned on a monthly basis on vehicles registered after January 1st or disposed of before the end of the year.
When a vehicle is overvalued or sold, traded in, or moved out of state, an abatement application must be filed with the Board of Assessors so a refund can be generated. The disposition of the vehicle and the disposition of the registration must be documented before an abatement can be processed in the case of a sale, trade-in or a move out of state. The manufacturer’s list price must be documented in cases of overvaluation.
The excise tax paid on one vehicle cannot be transferred to another vehicle. By state law, no abatement of less than $5 can be processed, and no excise tax can be reduced to less than $5.