Arkansas Vehicle Sales Tax & Fees [+Calculator]

Arkansas Sales Tax

Are you looking to purchase a vehicle in the state of Arkansas?

Then you will want to be aware of the state’s car sales tax which can impact the purchase price of the vehicle. For that reason, many people wonder how they can avoid paying car sales tax and if buying a car out of state is an option.

Here’s a look at what you need to know about Arkansas sales tax when it comes to vehicle sales.

How Much Is the Car Sales Tax in Arkansas?

How Much is Arkansas Sales TaxThe current sales tax in Arkansas is 6.5%.

It's important to note, this does not include any local or county sales tax, which can go up to 5.5%, for a total sales tax rate of 11.5%. However, the average total tax rate in Arkansas is 8.62%.

How to Calculate Arkansas Sales Tax on a Car

To calculate the sales tax on your vehicle, find the total sales tax fee for the city. The minimum is 6.5%. Multiply the vehicle price (after trade-in but before incentives) by the sales tax fee.

For example, imagine you are purchasing a vehicle for $20,000 with the state sales tax of 6.5%. The trade-in value of your vehicle is $5,000 and you have a $2,000 incentive. The total taxable amount is $15,000 since trade-ins are not taxable, but incentives/rebates are.

In this example, multiply $15,000 by .065 to get $975, which makes the total purchase price, $13,975 (account for the incentive).

Calculate Car Sales Tax in Arkansas Example:

  • Initial Car Price: $20,000
  • Sales Tax Rate: 6.5%
  • Trade-In Amount: $5,000
  • Incentive/Rebate Amount: $2,000

Sales Tax = ($20,000 - $5,000) * .065
Sales Tax = $975

Remember that the total amount you pay for a car (out the door price) not only includes sales tax, but also registration, and dealership fees.

Arkansas Sales Tax Calculator

Do I Have to Pay Sales Tax on a Used Car?

Thanks to a new rule, effective January 1st, 2022, the sales tax on used vehicles priced between $4,000 and $10,000 is now 3.5%. The price of used vehicles above $10,000 is the normal rate of 6.5%.

Used vehicles with a price of less than $4,000 are not subject to a state sales tax.

Which County Has the Highest Tax?

When you calculate the state and the county tax, the county with the highest sales tax in Arkansas is Lincoln County, with an 11.5% sales tax rate in the city of Gould.

Which County Has the Lowest Tax?

When accounting for both the state and the county tax rate, the county with the lowest tax is Carroll County with a total tax rate of 7%.

Car Sales Tax for Trade-Ins in Arkansas

Trade in ArkansasIn Arkansas, sales tax is not applied to the value of a trade-in. In other words, when calculating sales tax, be sure to subtract any trade-in amount from the purchase price before multiplying it by the tax rate.

For example, let’s say that you agree to purchase a new SUV for $52,000 and you trade in your old SUV for $12,000. This would bring the total purchase price of your new SUV to $40,000. At this point, only $40,000 would be taxed.

Car Sales Tax on Private Sales in Arkansas

In Arkansas, there is no tax when it comes to private vehicle sales.

As an example, if you purchase a used car from a private party for $15,000, you will not have to pay any sales tax on the vehicle.

Arkansas Dealer IncentivesTax on Rebates & Dealer Incentives

The state of Arkansas does tax rebates and dealer incentives. In other words, the taxable amount is before any incentives or rebates are applied.

As an example, if you purchase a car for $25,000 and have a dealer incentive for $3,000, the total taxable amount is still $25,000.

Arkansas DMV & State Fees

Arkansas charges the following DMV and state fees:

Vehicle Registration

  • Cars 3,000 Pounds or Less: $17.00
  • Cars 3,001 to 4,500 Pounds: $25.00
  • Cars 4,501 Pounds and Over: $30.00

Other Fees

  • Title Fee: $10.00
  • Tag Transfer Fee: $1.00
  • Lien Filing Fee: $.50
  • Doc Fees: ~$110 ($129 State Limit)

Arkansas Dealership Fees

Arkansas dealerships charge for the following fees:

  • Doc Fees: ~$110 ($129 State Limit)
  • Advertising Fees: ~$400 (Varies)
  • Transport Fee: $600-$1,500

Arkansas Tax ExemptionsWhen Sales Tax Is Exempt in Arkansas

You can avoid paying sales tax on vehicle transactions in Arkansas if you purchase a used car for less than $4,000.

Also, there are vehicle exemptions for non-profit charities, religious organizations, and gifted vehicles.

Arkansas EV Rebates & Incentives

In addition to the federal tax incentive, Arkansas offers an energy credit for the installation of charging stations in one’s home.

It's worth noting that there is an additional annual registration fee for hybrid and electric vehicles:

  • All-Electric Annual Fee: $200
  • Plug-in Hybrid Annual Fee: $100
  • Hybrid Annual Fee: $50

 

Tax information and rates are subject to change, please be sure to verify with your local DMV. 

Frequently Asked Questions

What is the sales tax on a car purchased in Arkansas?

The state sales tax on a vehicle purchase in the state of Arkansas is 6.5%. This excludes county and city taxes which could make the overall purchase price higher.

Do I have to pay sales tax on a used car in Arkansas?

Vehicles priced under $4,000 are exempt from sales tax. Vehicles priced from $4,000 to $10,000 are taxed at 3.5%. Vehicles priced over $10,000 are taxed at 6.5%.

Which county in Arkansas has the lowest tax?

When accounting for both the state and the county tax rate, the county with the lowest tax is Carroll County with a total 7% tax.

Which county in Arkansas has the highest tax?

When you calculate the state and the county tax, the county with the highest tax is Lincoln County with a total 11.5% tax.

Do I have to pay sales tax on a gifted car in Arkansas?

You do not have to pay tax on a gifted vehicle.

How much is registration in Arkansas?

Vehicle registration in Arkansas is determined by the weight of the vehicle. Here’s a look at the current registration price schedule:

  • Cars 3,000 Pounds or Less: $17.00
  • Cars 3,001 to 4,500 Pounds: $25.00
  • Cars 4,501 Pounds and Over: $30.00

Electric and hybrid vehicles have an additional annual fee in Arkansas.

Does a trade-in reduce sales tax in Arkansas?

Trade-ins can reduce the overall price of a vehicle and are not taxed in Arkansas. As an example, if you purchase an SUV with a $50,000 price and include a $15,000 trade-in, then the price of the new SUV will be taxed at $35,000.

How can I avoid paying sales tax in Arkansas?

You can avoid paying sales tax in Arkansas by purchasing a used vehicle for under $4,000. Also, you can avoid paying sales tax by having a vehicle gifted to you.