How Is Maine's Vehicle Excise Tax Calculated?

What the excise tax is

Before you can register a vehicle in Maine, you pay an annual excise tax to the municipality where you live. It's a local tax — the money funds your town, not the state — but the formula is set by state law, and Maine Revenue Services' excise tax page is the primary source for how it works.

The part that surprises used-car buyers: the tax is based on the manufacturer's suggested retail price when the car was new, not on what you just paid for it. A car that listed for $35,000 new is taxed on that $35,000 figure even if you bought it for a quarter of that eight years later.

The mill rate schedule

The tax applies a mill rate — dollars per thousand of original MSRP — that declines as the vehicle ages. Per the Maine Revenue Services schedule, the rates run from 24.00 mills in the vehicle's first year down through 17.50, 13.50, 10.00, and 6.50 in the following years, settling at 4.00 mills from the sixth year onward.

Worked example in round numbers: a used car that originally listed at $30,000, now in its sixth year or later, owes $30,000 × 0.004 = $120 for the year. The same car in its third year would owe $30,000 × 0.0135 = $405. This is why older used cars are meaningfully cheaper to keep registered in Maine — the rate floor is a sixth of the first-year rate.

How and where you pay

You pay at your town or city office when you register, and each year when you renew. Bring what your town asks for — typically the window sticker or documentation showing MSRP for a first-time registration, proof of insurance, and the title paperwork from the sale (see our title transfer guide). The town clerk calculates the tax from the MSRP and the vehicle's model year; you don't calculate it yourself, but knowing the schedule lets you budget before you buy.

Budgeting implications when shopping used

• Two similar cars can carry different excise bills. A three-year-old car and a six-year-old car at the same asking price will be taxed at very different rates on their original MSRPs.
• High-trim vehicles cost more forever. Because the base is original MSRP, a loaded trim level pays more excise tax than the base model of the same car every year you own it, even at the 4-mill floor.
• It's annual, not one-time. Unlike sales tax, excise tax recurs with every registration year.

One distinction worth keeping straight: excise tax is separate from the sales/use tax Maine collects on the purchase itself, which is also handled at registration time. Both are part of the real cost of putting a used car on the road, and both belong in your budget alongside the asking price — one reason the readiness checklist on our home page asks whether you've accounted for them. For current rates, exemptions, and edge cases, rely on Maine Revenue Services and your town office.