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How much is sales tax on a car in Tennessee?
Tennessee car sales tax guide (2026)
Short answer: Tennessee charges 7% state tax on vehicle purchases, about $2,100 on a $30,000 car (about $2,188 with typical local tax). Source: state revenue/DMV rules, checked October 28, 2026; local taxes and fees may add.
Page last updated: Oct 29, 2026 · Rules last checked: Oct 28, 2026
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Start my dealLocal option tax (up to 2.75%) applies to the first $1,600, plus a 2.75% state single-article tax on $1,600–$3,200; adds up to about $88. Doc fee taxability rule (TN DOR County Clerk Sales and Use Tax Manual (June 2025)): document and prep fees are part of the vehicle's sales price. Rebates and add-ons aren't modeled.
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Tennessee car sales tax, at a glance: 7% state tax on vehicle purchases. Local option tax (up to 2.75%) applies to the first $1,600, plus a 2.75% state single-article tax on $1,600–$3,200; adds up to about $88. Trade-in credit: allowed. A $30,000 car owes about $2,100 in state tax, or $1,400 with a $10,000 trade-in.
Statutory Status: Reviewed. Base sales tax: Tax Foundation, Facts & Figures 2026, Table 18 (State & Local Sales Tax Rates), as of October 28, 2026. Vehicle rules: Best-effort, checked October 28, 2026.
Leasing or getting a rebate in Tennessee?
Leases and rebates change the tax line on your quote. Here is how Tennessee handles each, in plain English, with the official source for each. Compare it to the tax on your dealer's worksheet.
Leasing in Tennessee
Tax on each payment (Tennessee single-article rules) · 7% + local
Tennessee taxes lease payments at 7%, plus your local rate on the first $1,600 and 2.75% single-article tax on the next $1,600. The cap cost reduction (cash down and rebates; TN says rebates do not reduce the taxable price) counts as an up-front lease payment, taxed first, so it uses up the local and single-article bands. Dealers may also pass through the TN business tax (0.15% state + 0.15% city where levied) on the price plus doc fee.
Cash down taxed at signing: Yes · Rebates taxed: Yes · Trade-in value taxed: No
Source: TN DOR SUT-43; TN Automobile Dealership Manual (Dec. 2023: single article applies to lease payments; rebates do not reduce the sales price; business tax may be passed to the customer); TN DOR business tax rates (Classification 2 retailer 0.0015); TCA 67-6-102 (checked Oct. 20, 2026)
Manufacturer rebates in Tennessee
Taxed on the price before the rebate
Tax is on the price before a manufacturer rebate or coupon (narrow exception for certain dealer-price incentives).
Estimate: a $1,000 rebate adds about $70 in state tax (state rate only; local tax can add more).
Source: TN DOR Automotive Dealership Manual (checked Oct. 21, 2026)
Tennessee worked examples
Rules last checked: Oct 28, 2026 · TN Department of Revenue rules
$30,000 car in Davidson County: $2,236.93 sales tax
| Vehicle price | $30,000.00 |
| Doc fee (example; taxed in Tennessee) | $699.00 |
| State sales tax 7% × $30,699.00 | $2,148.93 |
| County 2.25% on first $1,600 | $36.00 |
| Davidson Co. transit surcharge 0.5% on first $1,600 | $8.00 |
| State single-article 2.75% on $1,600–$3,200 | $44.00 |
| Total sales tax | $2,236.93 |
| Price + doc fee + tax (before title and registration) | $32,935.93 |
Local rate 2.75% applies only to the first $1,600. Open this example in the guide.
$35,000 car in Sumner County (unincorporated): $2,578.93 sales tax
| Vehicle price | $35,000.00 |
| Doc fee (example; taxed in Tennessee) | $699.00 |
| State sales tax 7% × $35,699.00 | $2,498.93 |
| County 2.25% on first $1,600 | $36.00 |
| State single-article 2.75% on $1,600–$3,200 | $44.00 |
| Total sales tax | $2,578.93 |
| Price + doc fee + tax (before title and registration) | $38,277.93 |
Local rate 2.25% applies only to the first $1,600. Open this example in the guide.
In Sumner County, Gallatin and Hendersonville add a 0.5% city rate on the first $1,600 (2.75% total), so the same $35,000 car comes to $2,586.93 in sales tax, $8.00 more. Davidson County's 2.75% is 2.25% county plus a 0.5% transit surcharge.
Not included: county wheel tax and county clerk fees, which vary by county (TN DOR VTR-34). Sources: TN DOR VTR-34, Sales Tax on a Vehicle Purchase (7% state + 2.75% single-article; page updated Sept. 30, 2026) · TN DOR Single Article Special Tax Rates · County Clerk Sales and Use Tax Manual (doc and prep fees are part of the sales price) · TN DOR local rate file. Checked 2026-10-28.
Best pick for your situation
If you have a car to sell: trade it in at the dealer when the private-sale price is less than $700 higher. Tennessee gives a trade-in credit, so a $10,000 trade cuts state tax on a $30,000 car from $2,100 to $1,400. If a private buyer would pay more than $10,000 + $700, selling privately comes out ahead.
The math:
- $30,000 car, no trade-in: $2,100 state tax at 7%
- $30,000 car, $10,000 trade-in: $1,400 state tax (trade-in rule: allowed)
- Local county/city tax adds to both; enter yours above.
Sources: Tax Foundation, Facts & Figures 2026, Table 18 (State & Local Sales Tax Rates) (October 28, 2026); vehicle rules best-effort from state DMV/revenue (Best-effort, checked October 28, 2026).
A situational guide based on published state tax and fee rules, not legal or financial advice. VaultRubric accepts zero dealer, lender, or affiliate compensation.
Your roadmap
- Enter the price, trade-in and your county above to see your exact tax.
- Get a written trade-in offer and a private-sale estimate, then compare using the math above.
- Ask for the out-the-door price in writing with tax, doc fee and title listed separately.
- Verify the rate with the Tennessee DMV or revenue department before signing; dealer quotes can be wrong.
- Plug the total into the to see the monthly payment.
Tennessee car sales tax by price
| Vehicle price | State tax, no trade | With $10,000 trade-in |
|---|---|---|
| $15,000 | $1,050 | $350 |
| $20,000 | $1,400 | $700 |
| $25,000 | $1,750 | $1,050 |
| $30,000 | $2,100 | $1,400 |
| $40,000 | $2,800 | $2,100 |
| $50,000 | $3,500 | $2,800 |
| $60,000 | $4,200 | $3,500 |
State-level tax only; add your county or city rate in the guide above.
Sources & as-of dates
- Base sales tax: Tax Foundation, Facts & Figures 2026, Table 18 (State & Local Sales Tax Rates) (as of October 28, 2026).
- Vehicle-specific rates and trade-in rules: best-effort compilation from state DMV/revenue rules (Best-effort, checked October 28, 2026); e.g. Virginia DMV, Michigan Treasury Form 485, California CDTFA Regulation 1610.
- Local vehicle tax (exact county/city table): Tennessee Department of Revenue, Streamlined Sales Tax rate file TNR2026Q4AUG21 and boundary file TNB2026Q4AUG21; TN DOR, Single Article Special Tax Rates (local tax on first $1,600; state single-article 2.75% on $1,600.01-$3,200); TN DOR, Single Article Local Tax Base Limitation chart (Hamblen $300, Hancock $375, Morristown $1,600); TN DOR Important Notice 24-11, Davidson County 0.5% transit surcharge (first $1,600, $44 local cap); US Census Bureau 2020 FIPS county/place names (retrieved October 28, 2026). The 7% state rate applies to the full taxable price (after trade-in). The local rate applies only to the first $1,600 (so at most $44 at 2.75%), plus a 2.75% state single-article tax on the portion from $1,600.01 to $3,200 (at most $44). Dealer-installed accessories count toward the single article. Trade-in value is subtracted before tax. Data file: tn.json.
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FAQ
How much sales tax on a $30,000 car in Davidson County, Tennessee?
$2,236.93 with a $699 doc fee: 7% of $30,699 ($2,148.93), plus $44 local tax on the first $1,600 and $44 state single-article tax.
How much sales tax on a $35,000 car in Sumner County, Tennessee?
$2,578.93 with a $699 doc fee in unincorporated Sumner County: 7% of $35,699 ($2,498.93), plus $36 local tax (2.25% on the first $1,600) and $44 single-article tax.
How much is car sales tax in Tennessee?
7% at the state level. Local option tax (up to 2.75%) applies to the first $1,600, plus a 2.75% state single-article tax on $1,600–$3,200; adds up to about $88. Local taxes may add. On a $30,000 car with no trade-in that's about $2,100 in state tax.
Does Tennessee charge sales tax on a trade-in?
Yes. Tennessee generally taxes the price minus your trade-in value, so a $10,000 trade-in on a $30,000 car cuts the state tax from $2,100 to $1,400. (Verified from state statute / DMV rules.)
Is Tennessee's general sales tax the same as its car tax?
Tennessee's statewide general sales tax is 7% (Tax Foundation, Facts & Figures 2026, Table 18 (State & Local Sales Tax Rates), as of October 28, 2026); the rate applied to vehicles is 7%.
Does Tennessee add county or city tax on a car?
Yes. The 7% state rate applies to the full taxable price (after trade-in). The local rate applies only to the first $1,600 (so at most $44 at 2.75%), plus a 2.75% state single-article tax on the portion from $1,600.01 to $3,200 (at most $44). Verify with your county clerk.
Does this include the doc fee, title and registration?
No. Those vary by dealer, county, vehicle weight and value.
Is this tax advice?
No. Estimates from best-effort state rules, not tax or financial advice; confirm with your state agency or dealer.
How are car leases taxed in Tennessee?
Tax on each payment (Tennessee single-article rules) (7% + local). Tennessee taxes lease payments at 7%, plus your local rate on the first $1,600 and 2.75% single-article tax on the next $1,600. The cap cost reduction (cash down and rebates; TN says rebates do not reduce the taxable price) counts as an up-front lease payment, taxed first, so it uses up the local and single-article bands. Dealers may also pass through the TN business tax (0.15% state + 0.15% city where levied) on the price plus doc fee. Source: TN DOR SUT-43; TN Automobile Dealership Manual (Dec. 2023: single article applies to lease payments; rebates do not reduce the sales price; business tax may be passed to the customer); TN DOR business tax rates (Classification 2 retailer 0.0015); TCA 67-6-102.
Is a car rebate taxed in Tennessee?
Yes, tax is figured on the price before a manufacturer rebate. Tax is on the price before a manufacturer rebate or coupon (narrow exception for certain dealer-price incentives). Source: TN DOR Automotive Dealership Manual.
Educational auto deal, sales tax, doc-fee, and loan/lease math only — not legal, tax, or financial advice. Dealerships are independent sellers; verify all out-the-door figures on your written buyer's order before signing.