Sales Tax on New Car (Phoenix: 2014, car registration, buying)

[AlaskaErik]

2014 is the year we retire and move to warmer climes. I'm looking to buy a new car before we move and wonder if I will have to pay Arizona sales tax on it. The new car will be purchased in Alaska (no sales tax here) and registered in Alaska before we head south. I'm not sure what the sales tax in the Phoenix area is, but I'm sure the impact will be significant as the new car will cost between 40 and 45K. I know some states have laws concerning this, but not sure about AZ.

[azdr0710]

if you buy in AK (the sale didn't take place in AZ), no sales tax would be due here....(correct me if I'm wrong, other C-Ders)

but be ready for registration fee of about $700-900/year (or more) on a car that pricey....$2.80 per $100 of value....and don't forget to change the registration very soon after you move here!!

Arizona Car Registration Guide - Renewals, Changing States, New Vehicle Purchases, Non Operational at DMV.org: The DMV Made Simple

and welcome to Arizona!

[HX_Guy]

Yeah, I don't think any sales tax will be due if the sales takes place in AK and is registered there first. But as was mentioned, be ready for some very high registration fees here...they are based off of vehicle value so the more expensive the car, the more you pay.

[AlaskaErik]

Ouch! It's either snow and cold and low taxes or warmth and sunshine and high taxes! Guess I'll have to suck it up and expect to pay way more in taxes than I ever have in my lifetime. Thanks for the quick answer.

[AlaskaErik]

I just did the math and if the sticker price is 42,500, the tax will be $714. The state must make an obscene amount of money from just this alone. I imagine this type of tax scheme must encourage people to keep their cars for a very long period of time. By the way, what is the sales tax on new vehicles?

[HX_Guy]

Sales tax on vnew vehicles is like on any other product...8.3% in the City if Phoenix.

[Bummer]

Very interesting, AlaskaErik . . .

From my fairly limited experience with buying a new vehicle out of state, I believe you will be required to pay Arizona Sales Tax (roughly 5%), but no additional county or city tax, since no tax was collected on the initial purchase.

I believe the law clearly states "No Duplicate Sales Tax" and since you never paid tax in Alaska . . .

Also, I have a feeling the tax will be calculated on the vehicle value when registering, not the original price paid so my guess would be about 5% of $30k - $40k, possibly even less, not the original selling price.

Definitely no expert so a quick call to the Arizona MVD would more than likely be best.

Good Luck

[maverick974]

I'm thinking that since he is going to purchase the car while still a resident of Alaska, he won't have to pay any sales tax. I'm no expert but how could he possibly be expected to pay tax if he isn't a resident yet? He will have to pay the registration which will be a fairly substantial amount but it's not like he is a resident trying to get out of paying a sales tax by buying a car out of state.
Is my thinking wrong here or am I missing something?

[ysr_racer]

If he purchased it in AK, and registered it in AK first, wouldn't it be a used car when he moves to AZ?

Actually, would this be different than anybody else moving to AZ with a car?

[wit-nit]

If you purchase a vehicle in another state and it's registered in that state you have paid that states taxes. If you up and move to AZ you only pay the license/registering fee which is based on the value of your vehicle.
You cannot be double taxed for the sale of that vehicle.