Any rebate, regardless of origin, is deducted from the sales price of a motor vehicle before calculating the tax.

The rebate must have a fixed value at the time of purchase.

The rebate may be:

  • Shown on the purchase agreement as a reduction in the vehicle purchase price
  • Applied as a down payment
  • Refunded directly to the customer

The deduction applies to manufacturers’ rebates and rebates issued by third parties who entered into an agreement with vehicle manufacturers. 


A credit card company offers car rebates as an incentive for buyers to use their credit card. The credit card company and vehicle manufacturer entered into a third-party agreement to offer the rebate. The rebate is deducted from the taxable sales price of the vehicle. 

Note: Rebates from off-road vehicles – such as watercraft, all-terrain vehicles, and snowmobiles – do not reduce the sales price of a motor vehicle before calculating sales tax.