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Last Updated: 8/16/2017

Taxable Sales


Parts used to repair or service a vehicle are taxable to the customer. Parts are easily assigned to a repair or service and have a fixed price. Examples are listed in the table below:

Auto body parts

Mechanical parts

      • Bumpers
      • Door panels
      • Fenders
      • Grilles
      • Headlights
      • Hoods
      • Rocker panels
      • Trunks
      • Windows
      • Alternators
      • Belts
      • Catalytic converters
      • Cylinder head gaskets
      • Fuel pump
      • Ignition coils
      • Oxygen sensors
      • Piston rings
      • Spark plugs
      • Tires

Do not pay sales or use tax when you purchase these parts to use in your business. Give your supplier a completed Form ST3, Certificate of Exemption. Specify the resale exemption.

Core charges

A core charge is a deposit charged at the time of purchase. The core charge is part of the taxable sales price when the part is subject to sales tax.

When the old part is returned, the core charge and the sales tax collected on the charge, is refunded back to the customer.

Oil changes

Prepaid oil changes are taxable at the time of purchase, not when they are redeemed.


When a customer trades in an old tire for a recapped tire, the entire charge is taxable, less an allowance for the trade-in.

Tire siping is taxable. The federal excise tax on tires is subject to sales tax.

Motor vehicle upgrades and enhancements

Labor to add or install something new or different to a vehicle is taxable. The parts being installed are also taxable to the customer. Examples include:

  • Adding customized vehicle accessories (dual exhaust, larger carburetor)

  • Adding power locks, power windows, cruise control, or window defrosters

  • Installing bug deflectors, lighting graphics, and running boards

  • Installing remote starters, navigation systems, sunroofs, or theft alarms

  • Spraying bed liners

  • Tinting windows

  • Upgrading a sound system

Vinyl decals

Charges to apply vinyl decals are taxable. If the customer brings a decal for you to apply, the charge to apply the decal is taxable. If you order or make a decal and apply it to a vehicle, the charges for the decal and the labor are both taxable.

Taxable services

The following services are taxable:

  • Applying fabric protector

  • Motor vehicle washing, waxing, and cleaning services, including coin-operated facilities

  • Rustproofing and undercoating of vehicles

For more information, see the Motor Vehicle Industry Guide.

Motor vehicle towing services

The total price charged for towing a motor vehicle is taxable, including administrative fees related to the service. Sales tax is charged on the towing fees that are based on where the towing service began. However, other services are not taxable.


  • A towing company in Maple Grove sends a tow truck to pick up a car in Minneapolis. The tow truck delivers the car to a body shop in Maple Grove. The towing service is subject to the tax rate in Minneapolis where the towing service began.

For more information, see the Motor Vehicle Industry Guide.

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