How Much Is Arkansas Sales Tax on Cars Bought Out of State?

Arkansas charges a 6.5% state use tax on vehicles bought out of state, and you pay it to the Department of Finance and Administration (DFA) when you title and register the car in Arkansas, not at the dealership where you bought it.¹ The rate drops for lower-priced used cars, disappears entirely under $4,000, and can be offset by sales tax you already paid to the other state. You have 60 days from the purchase date to register, and missing that deadline adds a 10% penalty.²

What You’ll Owe by Price

Arkansas uses a tiered structure based on the purchase price, and the tier depends on whether the vehicle is new or used.

For new vehicles, there is no tax if the purchase price is under $4,000. At $4,000 or more, the full 6.5% rate applies to the whole price.³ A $30,000 new car produces $1,950 in state tax.

Used vehicles get a middle tier. Under $4,000, no tax. From $4,000 through $9,999, a reduced state rate of 2.875% applies.⁴ At $10,000 and above, the full 6.5% rate takes over.⁵ An $8,000 used car runs $230 in state tax at the reduced rate; the same car at the full rate would be $520.

Local City and County Taxes

The 6.5% is only the state portion. Arkansas cities and counties levy their own sales and use taxes on vehicle purchases, and the rates vary by jurisdiction.¹ Check your local DFA office or the DFA’s online rate tables for the combined rate in your city and county before you budget the total.

Credit for Tax You Already Paid to the Other State

If the out-of-state dealer collected sales tax at purchase, Arkansas gives you a credit against the use tax you owe here, provided the other state extends the same courtesy to Arkansas residents.⁶

If the other state’s rate was 6.5% or higher, you owe nothing more to Arkansas.
If it was lower, you pay Arkansas the difference. Paid 4% in the other state? Arkansas collects the remaining 2.5%.
If the other state has no reciprocal credit for Arkansas buyers, you owe the full Arkansas tax with no offset, even though you already paid tax elsewhere.⁶

Bring proof. A dealer receipt or closing document showing the tax paid is what the DFA counter needs. Show up without it and you’ll be charged the full 6.5% regardless of what you handed the out-of-state seller.

Trade-Ins and Private Sales Reduce the Taxable Amount

If you traded a vehicle at the dealer, Arkansas taxes only the difference between the new car’s price and the trade-in credit.³ A $20,000 purchase with an $8,000 trade is taxed on $12,000. The rule applies whether the dealer was in Arkansas or another state.⁵

You can also get credit if you sold your old vehicle privately rather than trading it, but the window is narrow. The private sale must happen within 45 days before or after you buy the new vehicle, and the credit equals the cash you received, applied against the new car’s purchase price.⁷ You’ll need a bill of sale documenting the private sale amount; without it, no credit.⁸

Register Within 60 Days or Pay a 10% Penalty

You have 60 calendar days from the purchase date to title and register the vehicle with the DFA.² The tax is collected at that visit; there is no separate payment process.³

Miss the deadline and the DFA assesses a 10% penalty on the tax owed.³ On a $25,000 vehicle, the state tax is $1,625 and the late penalty adds $162.50. The DFA will not issue a plate until the tax and penalty are both paid, so you can’t legally drive the car on Arkansas roads in the meantime.

What to Bring to the Revenue Office

One missing document means a return trip. For an out-of-state purchase, Arkansas wants:⁹

The out-of-state title, signed by seller and buyer, plus a lien release from the prior lender if the title shows a lien.
A bill of sale listing the VIN, date, purchase price, and both signatures.
A current-year personal property assessment showing the vehicle, and proof that your county personal property taxes are current.
Proof of Arkansas liability insurance on the specific VIN.
An odometer statement for most vehicles under 20 years old.
Your loan or lien contract if you financed the car.

The personal property piece catches out-of-state buyers most often. Arkansas ties registration to your county’s assessment rolls. If the vehicle isn’t listed with your county assessor, or if any of your personal property taxes are overdue, the DFA won’t process the registration.

Title and Registration Fees

Separate from the sales tax, you’ll pay a $10 title fee and a weight-based registration fee at the counter:¹⁰

3,000 pounds or less: $17.00 registration plus $2.50 validation decal.
3,001 to 4,500 pounds: $25.00 registration plus $2.50 validation decal.
4,501 pounds and over: $30.00 registration plus $2.50 validation decal.

Private-Party Purchases Are Not Exempt

Arkansas’s isolated-sale exemption, which keeps most one-off private sales of personal property out of the sales tax net, does not apply to vehicles. Cars are specifically carved out.³ Buying from an individual in another state produces the same tax obligation as buying from a dealership. The absence of a dealer on the other end doesn’t change what you owe when you walk into the DFA.

1
Arkansas Department of Finance and Administration. Arkansas Compensating Use Tax Fact Sheet
2
Arkansas Department of Finance and Administration. Vehicle Tag Renewal
3
Arkansas Code. Arkansas Code 26-53-126 – Motor Vehicle, Trailer, or Semitrailer Sales and Use Tax
4
Justia Law. Arkansas Code 26-52-324 – Special Tax Rate for Certain Motor Vehicle Sales
5
Justia Law. Arkansas Code 26-52-510 – Sale of Motor Vehicles, Trailers, and Semitrailers
6
Justia Law. Arkansas Code 26-53-131 – Credit for Tax Paid in Another State
7
Code of Arkansas Rules. 26 CAR 30-702 – Sales Tax Credit for Private Sale of a Used Vehicle
8
Cornell Law Institute. 006.05.08 Ark. Code R. 12.1 – Sales Tax Credit for Private Sale of a Used Vehicle
9
Arkansas Department of Finance and Administration. Do You Have What You Need?
10
Arkansas Department of Finance and Administration. Motor Vehicle Registration Fee Schedule