Minnesota Car Loan & Lease Guide 2026
Everything you need to know about buying or leasing a car in Minnesota (MN) — sales tax, loan rates, incentives, and free calculators.
Minnesota Car Sales Tax (2026)
Minnesota state sales tax is 6.875%. Local sales taxes can add 0.5%–1.5% in some cities (e.g., Minneapolis 8.375%, St. Paul 8.875%).
Official Minnesota DMV: dps.mn.gov/divisions/dvs/Pages/default.aspx
Minnesota Car Buying Incentives & Programs (2026)
Minnesota offers up to $2,500 rebate for new EVs (-income limits apply). Federal tax credit up to $7,500 also applies. Cold weather packages are popular upgrades.
Quick Car Affordability Calculator — Minnesota
Estimate how much car you can afford in Minnesota, including sales tax (6.875% state rate).
Minnesota Car Buying FAQ
What is the sales tax on a car in Minnesota?
The state sales tax in Minnesota is 6.875%. With local taxes, the total rate ranges from 6.875% to 8.875%. This means buying a $35,000 car in Minnesota could cost $2406–$3106 in sales tax alone.
What is the average car loan rate in Minnesota?
The average auto loan rate in Minnesota is approximately 7% (based on the state's average credit score of 710). Rates vary by credit score: 750+ can get 5–7%, 650–749 pays 7–10%, and below 650 may see 10%+.
Are there EV incentives in Minnesota?
Minnesota offers up to $2,500 rebate for new EVs (-income limits apply). Federal tax credit up to $7,500 also applies. Cold weather packages are popular upgrades.
How much car can I afford in Minnesota?
Use the calculator above to estimate your budget. As a rule of thumb, your total car payment (loan + insurance) should not exceed 15–20% of your monthly take-home pay. In Minnesota, remember to factor in the 6.875% state sales tax when calculating your total budget.