Lease tax by state
How is a car lease taxed in Maryland?
Tax is charged up front on the full vehicle price. The Maryland state-level rate is 6.50%.
- Method
- Up-front tax on the full vehicle price
- State base rate
- 6.50% (excludes local add-ons)
- Down payment taxed?
- Yes — cap-cost reduction is taxed
- As of
- 2026-06-20
What this means for your lease
In plain English: tax is charged up front on the full vehicle price. Maryland's state-level lease sales-tax rate is 6.50% (before any local add-on).
Your cap-cost reduction (cash down, trade equity, or rebates applied as a down payment) IS taxed in Maryland, so putting more cash down does not escape the tax.
The detail
Like Texas: Maryland charges its motor vehicle excise tax (titling tax) UP FRONT on the vehicle's full retail value (NADA value / total purchase price), not on the monthly payments. Rate INCREASED from 6% to 6.5% effective July 1, 2025. Tax is collected at titling/registration via the MVA; it can be paid as part of down payment or rolled into the monthly payment, but the base is the full price, not the payment stream. Trade-in allowance on a leased vehicle can reduce the base in some roll-over situations.
Local add-ons
None — Maryland has no local vehicle excise taxes; statewide rate only.
See what this does to your true monthly cost
Maryland's tax method changes the real cost of a lease — sometimes more than the headline payment does. Drop your numbers into the calculator (we preselect Maryland) to fold the tax into one honest, comparable effective monthly figure.
Estimate my Maryland lease cost →Source: mva.maryland.gov · High confidence · Reviewed 2026-06-20. Tax method is researched and cited per state; rates are state-level and exclude local add-ons. This is an estimate — verify with your dealer or the Maryland Department of Revenue before you sign.