Friends and neighbors,
I have been hearing from a lot of people recently who are mad that their license tab fees aren’t dropping as their vehicles age. In the past, tab fees steadily declined each year as a car lost value. That isn’t happening anymore, and there’s a reason for it.
In 2023, when Democrats had complete control of state government, they approved a new formula for calculating registration fees. The tax rate on vehicles went up, and they changed the depreciation schedule that determines how quickly a vehicle’s taxable value falls. Instead of dropping 10 percent per year after the first year, it now drops only 5 percent during the first few years of ownership.
In practical terms, it means the state continues taxing newer vehicles as if they are still worth close to their original price.
As a result, Minnesotans who bought vehicles after November 2020 are paying nearly the same fee every year, even as their cars lose market value. For example, a driver who paid $398 in registration taxes in 2024 may see the same amount again in 2025 and 2026. It has left drivers confused, frustrated, and angry.
The goals for our tab fee system should be simplicity, predictability, and fairness. Today’s system is the opposite; it is complicated and expensive. Minnesotans deserve a return to a clear, reasonable structure that reflects what their vehicles are actually worth.
Sincerely,