Lease tax by state
How is a car lease taxed in North Dakota?
Tax on the total of all payments is collected up front. The North Dakota state-level rate is 5.00%.
- Method
- Up-front tax on the total of all payments
- State base rate
- 5.00% (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 on the total of all payments is collected up front. North Dakota's state-level lease sales-tax rate is 5.00% (before any local add-on).
Your cap-cost reduction (cash down, trade equity, or rebates applied as a down payment) IS taxed in North Dakota, so putting more cash down does not escape the tax.
The detail
For leases of 1 year or more (vehicles under 10,000 lbs), ND imposes the 5% motor vehicle excise tax up front on the total lease consideration, which expressly includes the down payment, acquisition/upfront fees, and the sum of all lease payments. Excludes title/registration, doc fees, optional warranty, insurance. Additional post-inception charges (excess mileage/wear) taxed when billed. Calculated via Lease Tax Worksheet SFN 60399.
Local add-ons
Motor vehicle excise tax is a flat statewide 5%; general local city/county sales taxes do not apply to the motor vehicle excise tax on leases.
See what this does to your true monthly cost
North Dakota'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 North Dakota) to fold the tax into one honest, comparable effective monthly figure.
Estimate my North Dakota lease cost →Source: tax.nd.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 North Dakota Department of Revenue before you sign.