Code of Massachusetts Regulations › 830 CMR - DEPARTMENT OF REVENUE › Title 830 CMR 64H.00 - Sales and Use Tax › Section 64H.25.1 - Motor Vehicles

Current through Register 1525, July 5, 2024
(1)
Purpose
. The sale or use of motor vehicles, trailers,
			 and other types of vehicles in Massachusetts is generally subject to the sales
			 or use tax. 830 CMR 64H.25.1 applies the provisions of M.G.L. c. 64H and M.G.L.
			 c. 64I, the Massachusetts sales and use tax statutes, to the sale or use of
			 such vehicles.
(2)
Definitions
. When used in 830 CMR 64H.25.1, the
			 following words have the following meanings, unless the context requires
			 otherwise:
Average trade-in price or value
, the
				wholesale or trade-in value which corresponds to a particular make, model,
				type, and year of a motor vehicle, trailer, or other vehicle, as listed in the
				most recent edition of the applicable National Automobile Dealers Association
				(NADA) used vehicle pricing guide or, if specifically agreed upon by the
				Commissioner and Registrar, any other values or used vehicle pricing guides
				designated under such agreement.
Business entity
, a person or entity
				regularly engaged in any activity, the object of which is profit or gain,
				direct or indirect.
Casual and isolated sale or transfer
,
				a sale or transfer at retail of a motor vehicle, trailer, or other vehicle
				other than a retail sale by a Massachusetts dealer or Massachusetts lessor in
				the regular course of business.
Commissioner
, the Commissioner of
				Revenue or any person authorized or designated to act on the Commissioner's
				behalf.
Dealer
, a person who is regularly
				engaged in the business of buying, selling, or exchanging motor vehicles,
				trailers, or other vehicles at retail.
Finance leasing arrangement
, a lease
				of a motor vehicle, trailer, or other vehicle which qualifies for treatment
				under and is taxed under the provisions of I.R.C. § 168(f)(8).
Insurer
, a person engaged in the
				business of providing personal casualty, property damage, fire and theft
				insurance for motor vehicles, trailers, and other vehicles.
Lessor
, a person who is regularly
				engaged in the business of leasing or renting motor vehicles, trailers, or
				other vehicles.
Massachusetts dealer
, a dealer who
				holds a valid Massachusetts Vendor's Registration Certificate.
Massachusetts lessor
, a lessor who
				holds a valid Massachusetts Vendor's Registration Certificate.
Massachusetts Vendor's Registration
				Certificate
, Department of Revenue Form ST-1, lawfully obtained
				from and issued by the Commissioner to a dealer or lessor.
Motor Vehicle
, a motorized,
				self-propelled vehicle which is constructed and designed for transportation or
				travel over a land surface; but not including mopeds, motorized bicycles, or
				vehicles incapable of speeds in excess of 12 miles per hour which are used
				other than for transporting persons or property, and are either used
				exclusively for highway building, repair, or maintenance, or are especially
				designed for use other than on public highways.
Off-road Vehicle
, a motorized,
				self-propelled vehicle which is not designed for use nor used primarily for
				transportation or travel on public highways.
Purchaser
, a buyer, vendee, lessee,
				renter, or other person who receives title to or possession of a motor vehicle,
				trailer, or other vehicle as the result of a sale.
Registrar
, the Registrar of Motor
				Vehicles or any person authorized or designated to act on the Registrar's
				behalf.
Resale in the regular course of
				business
, a sale, other than a lease or rental, of a motor
				vehicle, trailer, or other vehicle by a Massachusetts dealer, or a lease or
				rental of a motor vehicle, trailer, or other vehicle by a Massachusetts lessor,
				which is the type of sale or lease, whichever is applicable, upon which the
				dealer or lessor primarily relies in the conduct of its business. Resale
				includes the use of a vehicle for demonstration or display.
Sale
, any transfer of title or
				possession, or both, by exchange, barter, lease, rental, conditional or
				otherwise, of a motor vehicle, trailer, or other vehicle for a consideration in
				any manner or by any means whatsoever.
Sale at retail or retail sale
, a sale,
				lease, or rental of a motor vehicle, trailer, or other vehicle for any purpose
				other than resale in the regular course of business.
Sales Price
, the total amount or value
				paid or exchanged by a purchaser as consideration for the transfer of title to
				or possession of a motor vehicle, trailer, or other vehicle, whether valued in
				money or otherwise, less any vehicle manufacturer's excise tax imposed by the
				United States.
Sales Tax
, the tax imposed by M.G.L.
				c. 64H on the retail sale of a motor vehicle, trailer, or other vehicle by a
				Massachusetts dealer or Massachusetts lessor in the regular course of
				business.
Seller
, a vendor, dealer, lessor, or
				other person who transfers title to or possession of a motor vehicle, trailer,
				or other vehicle in exchange for consideration.
Storage
, the keeping or retaining of a
				motor vehicle, trailer, or other vehicle for any purpose other than the sale of
				the vehicle in the regular course of business or the use of the vehicle
				exclusively outside of Massachusetts.
Trade-in
, the transfer of complete
				ownership of a motor vehicle, trailer, or other vehicle from a purchaser to a
				seller, but only if the transfer occurs at the time of and as consideration for
				a sale of a similar type of vehicle by the seller to the purchaser.
Trailer
, a vehicle which is not
				self-propelled, which must be towed by a motor vehicle, and which is
				constructed and designed for use upon the public highways.
Transferee
, a purchaser or other
				person who becomes the legal, equitable, or beneficial owner of a motor
				vehicle, trailer, or other vehicle as a result of the sale, lease, gift or
				other transfer of title to or possession of a vehicle.
Transferor
, a person who sells, gives,
				or otherwise transfers legal, equitable, or beneficial ownership or possession
				of a motor vehicle, trailer, or other vehicle to a transferee.
Unrealistic sales price
, a sales price
				which is less than the average-trade-in price.
Use
, the exercise of any right or
				power over a motor vehicle, trailer, or other vehicle incident to the ownership
				of title to or possession of the vehicle; but not including a sale of the
				vehicle in the regular course of business.
User
, a person who stores, uses,
				consumes, or otherwise exercises a right or power over a motor vehicle,
				trailer, or other vehicle in Massachusetts.
Use Tax
, the tax imposed by M.G.L. c.
				64I upon the storage, use, or other consumption of a motor vehicle, trailer, or
				other vehicle in Massachusetts.
Vehicle
, a motor vehicle, trailer, or
				any self-propelled machine constructed and designed primarily for
				transportation or travel over a land surface; but not including railroad,
				railway, or trolley cars, or any other machines running upon rails or
				tracks.
(3)
Imposition of the Sales Tax; Imposition of the Use
			 Tax
.
(a)
General
			 Rule
. Upon the retail sale or other transfer of a motor vehicle,
			 trailer, or other vehicle in Massachusetts, or upon the storage, use, or other
			 consumption of a motor vehicle, trailer, or other vehicle in Massachusetts, a
			 sales or use tax is imposed on the purchaser, transferee, or other user by
			 either M.G.L. c. 64H or c. 64I. The sales tax, which is imposed by M.G.L. c.
			 64H, applies only to transfers of title or possession through retail sales by
			 Massachusetts dealers and Massachusetts lessors in the regular course of
			 business. The use tax, which is imposed by M.G.L. c. 64I, applies to all other
			 types of transfers of title or possession where the vehicle transferred is
			 thereafter stored, used, or otherwise consumed in Massachusetts. The tax is
			 imposed at the rate of five percent, and is calculated and paid pursuant to the
			 provisions of the applicable statute and 830 CMR 64H.25.1. No exception,
			 adjustment, exemption, deduction, or variance of the tax is permitted, unless
			 specifically authorized by M.G.L. c. 64H or c. 64I and 830 CMR
			 64H.25.1.
(b)
Sales
			 Tax
.
1. The sale at retail of a
			 motor vehicle, trailer, or other vehicle by a Massachusetts dealer or
			 Massachusetts lessor in the regular course of business is subject to the sales
			 tax imposed by M.G.L. c. 64H, § 2, unless specifically exempt under that
			 statute and 830 CMR 64H.25.1(5), (7), or (8).
2. Every sale of a motor vehicle, trailer, or
			 other vehicle in Massachusetts is presumed to be a sale at retail. This
			 presumption is rebuttable, and may be overcome by sufficient evidence to the
			 contrary.
(c)
Use Tax
.
1. The
			 storage, use, or other consumption in Massachusetts of a motor vehicle,
			 trailer, or other vehicle purchased or transferred for storage, use, or other
			 consumption in Massachusetts, is subject to the use tax imposed by M.G.L. c.
			 64I, § 2, unless specifically exempt under that statute and 830 CMR
			 64H.25.1(5), (7), or (8).
2. Every
			 motor vehicle, trailer, or other vehicle sold or transferred for delivery in
			 Massachusetts or brought into Massachusetts is presumed to have been sold or
			 transferred for storage, use, or other consumption in Massachusetts, unless the
			 vehicle is used exclusively outside of Massachusetts for a period of six months
			 before the date it is first delivered, brought into, or used in Massachusetts.
			 This presumption is rebuttable, and may be overcome by sufficient evidence to
			 the contrary. A vehicle which is used exclusively outside of Massachusetts for
			 a period of at least six months before it is delivered, brought into, or used
			 in Massachusetts is subject to the use tax imposed by M.G.L. c. 64I, § 2
			 only if, at the time of the purchase or transfer, the purchaser or transferee
			 intended to store, use, or otherwise consume the vehicle in
			 Massachusetts.
(d)
Examples
. The following examples illustrate the
			 application of 830 CMR 64H.25.1(3).
Example 1
: Mr. Blue lives in Florida.
				While visiting in Massachusetts he decides to purchase a Volvo from a
				Massachusetts dealer for use in Florida. He pays for the vehicle and receives
				the certificate of origin to and possession of the vehicle in Massachusetts.
				Thereafter he drives the vehicle to his home in Florida. Mr. Blue must pay
				Massachusetts sales tax on the Volvo because title to and possession of the
				vehicle were transferred to him in Massachusetts.
Example 2
: Ms. Green lives in New
				Hampshire. She comes to Massachusetts to purchase an automobile for use in New
				Hampshire, and orders an Oldsmobile from a Massachusetts dealer at an agreed
				upon price. When the vehicle becomes available, the dealer delivers it to Ms.
				Green in New Hampshire. Ms. Green then pays the dealer and receives the
				certificate of origin to and possession of the vehicle in New Hampshire.
				Thereafter she uses it in New Hampshire. The sale to Ms. Green is not subject
				to the Massachusetts sales or use tax because neither title to nor possession
				of the vehicle was transferred in Massachusetts and because it was not
				purchased for use in Massachusetts.
Example 3
: Mr. Fox lives in
				Massachusetts. While vacationing in Europe he purchases a Volkswagen, which he
				then uses to travel through various European countries. Four months later he
				returns to Massachusetts with the vehicle. Mr. Fox must pay a use tax to
				Massachusetts for the Volkswagen. It is presumed that he purchased the vehicle
				for storage, use, or other consumption in Massachusetts because it was not used
				exclusively outside of Massachusetts for a six month period following the date
				of purchase.