How Do You Calculate the Sales Tax on Used Cars in Arkansas?
Multiply the purchase price of the used vehicle by the Arkansas sales tax rate of 6.5 percent to determine the sales tax you need to pay when you buy a used car in Arkansas. Those who buy a vehicle in Texarkana are required to pay 7 percent sales tax.
- Consider the price of the vehicle
Determine the final purchase price to find out the basis for the sales tax. The state of Arkansas computes the total delivery price, which includes freight charges, extra equipment, any rebates and any extended warranties, but not federal excise tax.
- Multiply the purchase price by the tax rate
Convert the percentage to a decimal. For example, for most residents, the tax rate is 6.5 percent. In decimal form, 6.5 percent is 0.065 percent. Assuming the purchase price of the vehicle were $10,000, you multiply $10,000 by 0.065. In this example, the result is $650.
- Add the purchase price and total tax
Calculate the total cost of the vehicle purchase by adding the amount of the purchase price to the amount of taxes required. In the above example, add $10,000 and $650 together to equal $10,650. (The total includes the purchase price and tax.)