Ohio – Motor Vehicle Sales to Nonresidents

SALT Report 2955 – The Ohio Department of Taxation updated an information release that discusses the application of sales and use tax to sales of motor vehicles by Ohio motor vehicle dealers to non-residents as required by R.C. 5739.029. This regulation allows the State to impose sales tax on the purchase of a motor vehicle by a non-resident who will remove the vehicle from Ohio and have it titled, registered, or used in another state, or foreign country.

The notice has been updated to addresses changes that were made in the following states:

  • Arizona’s sales tax rate has decreased to 5.6%
  • California’s rate has increased to 7.5%
  • South Carolina has put a $300.00 sales tax cap on purchases of motor vehicles

Currently, Ohio motor vehicle dealers are only required to collect sales tax on sales to non-residents who will remove the vehicle from Ohio to use in one of these states: Arizona, California, Florida, Indiana, Massachusetts, Michigan and South Carolina.

The notice provides further guidance on how to calculate the sales tax, how to report and remit tax, trade-in allowances, motor vehicle sales to Ohio residents, leased vehicles, and examples of situations that may affect the imposition of tax.

For Further Information

Ohio Department of Taxation – Sales and Use Tax Information Release ST 2007-04