Massachusetts 5% use tax is imposed on the storage, use or other consumption in Massachusetts of tangible personal property purchased from any vendor for storage, use or consumption within Massachusetts. G.L. c. 64I, § 2. Massachusetts General Laws Chapter 64I, Section 7(c) sets forth an exemption from the Massachusetts use tax for sales upon which the purchaser has paid a tax or made reimbursement therefor to a vendor or retailer under the laws of any state or territory of the United States. The exemption applies only where the tax was legally due without any right to a refund or credit, and the other state or territory allows a corresponding exemption with respect to the sale or use of tangible personal property upon which a sales or use tax was paid to Massachusetts.

Where a tax was paid under the laws of another state at a rate of less than five percent, including any local sales tax rate, the exemption applies, but the Massachusetts use tax will be determined by subtracting the tax paid to another state from the Massachusetts use tax.

This Technical Information Release (TIR) lists the jurisdictions that allow a corresponding exemption, and explains certain restrictions on the Massachusetts exemption that apply to taxes paid to several of those jurisdictions. This TIR applies to sales of motor vehicles and all other tangible personal property with the exception of boats and airplanes. This TIR revokes and replaces Technical Information Release 81-2.

1. The following jurisdictions allow an exemption corresponding to the exemption provided in G.L. c. 64I, § 7(c).

  • Arizona New Jersey
  • Arkansas New Mexico
  • California New York
  • Colorado North Dakota
  • Connecticut Ohio
  • Florida Pennsylvania
  • Hawaii Rhode Island
  • Idaho South Carolina
  • Illinois South Dakota
  • Iowa Tennessee
  • Kansas Texas
  • Louisiana Utah
  • Maine Virginia
  • Michigan Washington
  • Missouri Wisconsin
  • Nebraska

2. In the following jurisdictions, an exemption corresponding to the exemption in G.L. c. 64I, § 7(c) is allowed with the additional restrictions specified for each state. Where a purchaser has paid a tax under the laws of such a jurisdiction, the Massachusetts exemption in G.L. c. 64H, § 7(c) will apply, subject to the same restrictions as found in the laws of such other jurisdiction.

Alabama Corresponding exemption allowed except for local taxes.

District of Columbia Corresponding exemption allowed for tangible personal property except for motor vehicles (titling excise).

Georgia A credit against the state sales tax is allowed for sales tax paid to other states, and a credit against local sales tax is allowed for sales tax paid to local jurisdictions in other states. Thus, the Massachusetts exemption is available only for sales tax paid to the state of Georgia and is not available for sales tax paid to local jurisdictions in Georgia.

Indiana Corresponding exemption allowed for tangible personal property except for motor vehicles.

Kentucky Exemption allowed for sales taxes paid; no exemption for machinery, tools and equipment brought into the state for construction.

Maryland Corresponding exemption allowed for tangible personal property except for motor vehicles (titling excise) unless registered and titled in another state and present owner has not been a resident for more than 30 days. Credit for motor vehicles cannot reduce excise below $100.

Minnesota Corresponding exemption allowed except for local taxes.

Mississippi Corresponding exemption allowed for tangible personal property except for automobiles, trucks and truck-tractors first used in Mississippi.

North Carolina A credit against the state sales tax is allowed for sales tax paid to other states and a credit against local sales tax is allowed for sales tax paid to local jurisdictions in other states. Thus, the Massachusetts exemption is available only for sales tax paid to the state of North Carolina and is not available for sales tax paid to local jurisdictions in North Carolina.

Oklahoma Corresponding exemption allowed for tangible personal property except for motor vehicles.

Vermont Corresponding exemption allowed for tangible personal property except for motor vehicles.

West Virginia Corresponding exemption allowed for tangible personal property except for motor vehicles (titling privilege excise).

Wyoming Exemption is allowed for sales tax but not use tax paid and a bona fide first use must have occurred outside the state.

3. Nevada does not allow an exemption corresponding to the exemption provided in G.L. c. 64I, § 7(c).

4. The following states do not have a sales tax.

  • Alaska New Hampshire
  • Delaware Oregon
  • Montana

/s/ Mitchell Adams
Mitchell Adams
Commissioner of Revenue

TIR 91-7

October 3, 1991