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Short-Term Rentals

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Short-term motor vehicle rentals are leases of vehicles under an agreement for 28 days or less. Short-term rentals for certain motor vehicles are subject to the following:

  • Minnesota general sales tax rate
  • Any local taxes that apply
  • 9.2 percent Motor Vehicle Rental Tax
  • 5 percent Motor Vehicle Rental Fee, if applicable

Individuals, institutions, businesses, nonprofit organizations, and Minnesota state and local government agencies must pay the rental tax and fee, in addition to the general state sales tax and any applicable local sales tax.

The Motor Vehicle Rental Tax and Fee are due on all rental agreements that meet the following requirements:

  • The vehicle is a passenger automobile (designed to carry up to 15 passengers including the driver) including:
  • Passenger car
  • Passenger van with a carrying capacity of 3/4 ton or less (rated by the manufacturer)
  • Pickup truck with a carrying capacity of 3/4 ton or less (rated by the manufacturer)
  • The period of the agreement is 28 days or less
  • The customer takes possession of the vehicle in Minnesota

Note: The Motor Vehicle Rental Tax and Fee apply to short-term rentals, such as daily or weekly, even if the customer keeps the vehicle for more than 28 days. (Because the agreement is for 28 days or less, even if the customer keeps the vehicle for more than 28 days.)