Car tab/Motor Vehicle Excise Tax

What is the status of MVET collections following passage of I-976?

Initiative 976, adopted in November 2019, seeks to reduce certain state and local vehicle license taxes.  The initiative allows, and state law requires, Sound Transit to continue collecting its current voter-approved Motor Vehicle Excise Tax and its Rental Car Tax until all bond and other debts secured by the taxes are repaid. The initiative seeks to have Sound Transit accelerate repayment of these bonds and other debts, at which point the Sound Transit MVET could be reduced or eliminated.

At the Sound Transit Board’s direction, the agency will continue to monitor recent litigation initiated by other jurisdictions to determine whether I-976 is constitutional and enforceable, and will evaluate legal issues specific to Sound Transit.

To repay its bonds and debts early, Sound Transit would have to collect additional taxes and divert revenues from transit projects in order to pay the cost of bond defeasance, refinancing or retirement. In addition, early bond and debt repayment in order to eliminate a projected $7.2 billion in MVET and Rental Car Tax revenue would require cutting or significantly delaying projects and services. An analysis shows that delays of approximately five years could be required for projects not already under construction or under contract. This would require local taxpayers to pay an estimated $25 billion more to absorb inflation of project costs and repay additional and higher-interest debt. The date by which Sound Transit taxes would eventually be rolled back would be delayed by approximately 12 years.

Additional information on the potential impacts to agency projects and services, including the significantly increased costs that would come from delays, can be found in the statement that Sound Transit issued in November 2019. 

How is the MVET calculated?

The Motor Vehicle Excise Tax (MVET) is a RTA tax charged upon purchase or annual renewal of a new or used car. It is currently calculated from the depreciated value of your vehicle by using a formula based on the vehicle manufacturer’s suggested retail price (MSRP), or purchase price for commercial trucks and commercial trailers, and a depreciation schedule based on the age of the vehicle. The depreciation schedule, set by state law, has been in place since 1999.

Contact the Department of Licensing (DOL) with questions about the RTA MVET, such as types of vehicles subject to the tax.

I lived in the RTA when I renewed and paid the RTA tax. Now that I've moved, can I get a refund?

The RTA tax is assessed at the time of renewal using the vehicle's address of record and is not pro-rated or refundable. Please make sure your address is updated with Department of Licensing (DOL) in accordance with state laws each time you move.

I received a Shortage letter. What is it?

Sometimes the MVET tax is not collected at purchase or renewal. If that happens you will receive a shortage letter from the Department of Licensing (DOL) that includes information about how to pay the shortage bill. The RTA tax must be paid before you can renew your car tabs.