What is the sales tax rate on a car in Texas?

Texas charges a flat 6.25% motor-vehicle sales and use tax on the purchase of a car. Unlike the general 8.25% sales tax on most goods, the motor-vehicle tax has no local city or county add-on, so it is 6.25% statewide.

Does a trade-in reduce car sales tax in Texas?

Yes. When you trade a vehicle in to a licensed dealer, the trade-in allowance is subtracted from the sales price before tax is calculated. If you buy a $30,000 car and trade in a vehicle worth $8,000, you are taxed on $22,000.

Do rebates reduce the taxable price in Texas?

No. In Texas, manufacturer cash rebates do not reduce the taxable amount. Sales tax is calculated on the price before the rebate is applied, even though the rebate lowers what you actually pay.

How is sales tax handled on a private-party car sale in Texas?

For private-party purchases, Texas taxes the greater of the actual sales price or 80% of the vehicle's Standard Presumptive Value (SPV). This prevents underreporting; if your price is well below market value, expect tax based on the SPV figure.

Is the dealer documentary fee taxable in Texas?

Yes. The dealer documentary or processing fee is considered part of the taxable sales price in Texas, so the 6.25% motor-vehicle tax applies to it. This calculator includes the doc fee in the taxable base.

Texas Car Sales Tax Calculator

Email me this result

Get this tool's output sent to your inbox, plus one useful tool a week. No spam, unsubscribe any time.

How Texas taxes a vehicle purchase

Texas applies a flat 6.25% motor-vehicle sales/use tax to car purchases. Crucially, this is different from the general Texas sales tax (up to 8.25% with local add-ons): the motor-vehicle tax has no local component — it is 6.25% everywhere in the state. The trick to getting the number right is knowing what counts in the taxable base.

How it works

The taxable amount is built like this:

Start with the vehicle price plus the dealer documentary fee (the doc fee is taxable in Texas).
Subtract the trade-in allowance — Texas lets a dealer trade-in reduce the taxable price.
Do not subtract manufacturer rebates — Texas taxes the price before rebates.

Then the tax is taxable amount × 6.25%. The estimated drive-out total then subtracts the rebate (since you don’t actually pay it) and adds title and registration fees.

taxable = (price + doc fee) − trade-in
tax     = taxable × 0.0625

Tips and notes

For private-party sales, Texas taxes the greater of your sales price or 80% of the Standard Presumptive Value (SPV). If your price looks low, the county may bill tax on the SPV instead.
Title and registration fees are separate from sales tax — use the related Texas vehicle registration fee calculator for those.
This is an estimate, not tax advice. Confirm figures with the Texas Comptroller at comptroller.texas.gov.