The average new car price is now $47,401, but that’s only one aspect of the total cost of car ownership — and that cost can vary greatly from state to state. For example, some states have no or low sales tax, which can make a big difference when it comes to a large purchase like a car.
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To find the annual cost of car ownership in every state, GOBankingRates assumed a 20% down payment of $9,480 on the average-priced car, which means $8,316 per year for the average 60-month car loan. Sales tax, annual car insurance premiums, gas prices and costs of repairs and maintenance for each state were also calculated to find the total ownership costs for the year.
Here’s a look at the 20 most and least expensive states to own a car.
The Most Expensive States To Own a Car
When you account for financing, sales tax, insurance, gas and repairs, the cost to own a car for a year exceeds $25,000 in all of these states.
Here are the 20 most expensive states to own a car, ranked from most to least expensive.
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1. California
- Sales tax (assuming $47,401 MSRP): $3,437
- Average car insurance premium: $2,115
- Annual cost of gas: $3,529
- Average car repair costs: $416
- Total costs for 1 year of ownership: $27,292
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2. Nevada
- Sales tax (assuming $47,401 MSRP): $3,911
- Average car insurance premium: $2,023
- Annual cost of gas: $2,964
- Average car repair costs: $398
- Total costs for 1 year of ownership: $27,092
3. Florida
- Sales tax (assuming $47,401 MSRP): $2,844
- Average car insurance premium: $2,560
- Annual cost of gas: $2,412
- Average car repair costs: $396
- Total costs for 1 year of ownership: $26,008
4. Illinois
- Sales tax (assuming $47,401 MSRP): $3,437
- Average car insurance premium: $1,578
- Annual cost of gas: $2,726
- Average car repair costs: $379
- Total costs for 1 year of ownership: $25,916
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5. Washington
- Sales tax (assuming $47,401 MSRP): $3,081
- Average car insurance premium: $1,371
- Annual cost of gas: $3,015
- Average car repair costs: $392
- Total costs for 1 year of ownership: $25,655
6. Michigan
- Sales tax (assuming $47,401 MSRP): $2,844
- Average car insurance premium: $2,133
- Annual cost of gas: $2,507
- Average car repair costs: $356
- Total costs for 1 year of ownership: $25,637
7. Rhode Island
- Sales tax (assuming $47,401 MSRP): $3,318
- Average car insurance premium: $1,845
- Annual cost of gas: $2,290
- Average car repair costs: $387
- Total costs for 1 year of ownership: $25,636
8. New Jersey
- Sales tax (assuming $47,401 MSRP): $3,143
- Average car insurance premium: $1,901
- Annual cost of gas: $2,310
- Average car repair costs: $400
- Total costs for 1 year of ownership: $25,549
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9. Kansas
- Sales tax (assuming $47,401 MSRP): $3,555
- Average car insurance premium: $1,594
- Annual cost of gas: $2,197
- Average car repair costs: $374
- Total costs for 1 year of ownership: $25,517
10. Kentucky
- Sales tax (assuming $47,401 MSRP): $2,844
- Average car insurance premium: $2,105
- Annual cost of gas: $2,257
- Average car repair costs: $385
- Total costs for 1 year of ownership: $25,387
11. Connecticut
- Sales tax (assuming $47,401 MSRP): $3,010
- Average car insurance premium: $1,750
- Annual cost of gas: $2,393
- Average car repair costs: $418
- Total costs for 1 year of ownership: $25,367
12. Georgia
- Sales tax (assuming $47,401 MSRP): $3,128
- Average car insurance premium: $1,647
- Annual cost of gas: $2,330
- Average car repair costs: $408
- Total costs for 1 year of ownership: $25,309
13. Utah
- Sales tax (assuming $47,401 MSRP): $3,247
- Average car insurance premium: $1,469
- Annual cost of gas: $2,347
- Average car repair costs: $402
- Total costs for 1 year of ownership: $25,261
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14. Indiana
- Sales tax (assuming $47,401 MSRP): $3,318
- Average car insurance premium: $1,256
- Annual cost of gas: $2,483
- Average car repair costs: $365
- Total costs for 1 year of ownership: $25,218
15. Texas
- Sales tax (assuming $47,401 MSRP): $2,963
- Average car insurance premium: $1,875
- Annual cost of gas: $2,140
- Average car repair costs: $398
- Total costs for 1 year of ownership: $25,171
16. Maryland
- Sales tax (assuming $47,401 MSRP): $2,844
- Average car insurance premium: $1,640
- Annual cost of gas: $2,436
- Average car repair costs: $399
- Total costs for 1 year of ownership: $25,115
17. Tennessee
- Sales tax (assuming $47,401 MSRP): $3,318
- Average car insurance premium: $1,373
- Annual cost of gas: $2,198
- Average car repair costs: $399
- Total costs for 1 year of ownership: $25,084
18. Minnesota
- Sales tax (assuming $47,401 MSRP): $3,081
- Average car insurance premium: $1,493
- Annual cost of gas: $2,308
- Average car repair costs: $378
- Total costs for 1 year of ownership: $25,056
19. Nebraska
- Sales tax (assuming $47,401 MSRP): $2,607
- Average car insurance premium: $2,018
- Annual cost of gas: $2,255
- Average car repair costs: $375
- Total costs for 1 year of ownership: $25,051
20. Pennsylvania
- Sales tax (assuming $47,401 MSRP): $2,844
- Average car insurance premium: $1,445
- Annual cost of gas: $2,579
- Average car repair costs: $384
- Total costs for 1 year of ownership: $25,049
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The Least Expensive States To Own a Car
The difference in the annual cost to own a car between the most and least expensive states is a pretty significant amount — $5,539. One major factor in the cost savings is sales tax, with all of the top five least expensive states having no sales tax.
Here’s a look at the least expensive states to own a car, ranked from lowest to highest annual cost.
1. New Hampshire
- Sales tax (assuming $47,401 MSRP): $0
- Average car insurance premium: $1,307
- Annual cost of gas: $2,279
- Average car repair costs: $371
- Total costs for 1 year of ownership: $21,753
2. Alaska
- Sales tax (assuming $47,401 MSRP): $0
- Average car insurance premium: $1,359
- Annual cost of gas: $2,630
- Average car repair costs: $387
- Total costs for 1 year of ownership: $22,172
3. Oregon
- Sales tax (assuming $47,401 MSRP): $0
- Average car insurance premium: $1,244
- Annual cost of gas: $2,812
- Average car repair costs: $394
- Total costs for 1 year of ownership: $22,246
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4. Montana
- Sales tax (assuming $47,401 MSRP): $0
- Average car insurance premium: $1,692
- Annual cost of gas: $2,404
- Average car repair costs: $390
- Total costs for 1 year of ownership: $22,282
5. Delaware
- Sales tax (assuming $47,401 MSRP): $0
- Average car insurance premium: $2,137
- Annual cost of gas: $2,354
- Average car repair costs: $391
- Total costs for 1 year of ownership: $22,678
6. Alabama
- Sales tax (assuming $47,401 MSRP): $948
- Average car insurance premium: $1,542
- Annual cost of gas: $2,232
- Average car repair costs: $399
- Total costs for 1 year of ownership: $22,918
7. North Carolina
- Sales tax (assuming $47,401 MSRP): $1,422
- Average car insurance premium: $1,368
- Annual cost of gas: $2,316
- Average car repair costs: $403
- Total costs for 1 year of ownership: $23,305
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8. Oklahoma
- Sales tax (assuming $47,401 MSRP): $1,541
- Average car insurance premium: $1,797
- Annual cost of gas: $2,166
- Average car repair costs: $380
- Total costs for 1 year of ownership: $23,679
9. Colorado
- Sales tax (assuming $47,401 MSRP): $1,375
- Average car insurance premium: $1,940
- Annual cost of gas: $2,183
- Average car repair costs: $417
- Total costs for 1 year of ownership: $23,711
10. Virginia
- Sales tax (assuming $47,401 MSRP): $1,967
- Average car insurance premium: $1,321
- Annual cost of gas: $2,352
- Average car repair costs: $401
- Total costs for 1 year of ownership: $23,838
11. New Mexico
- Sales tax (assuming $47,401 MSRP): $1,896
- Average car insurance premium: $1,505
- Annual cost of gas: $2,263
- Average car repair costs: $393
- Total costs for 1 year of ownership: $23,853
12. South Dakota
- Sales tax (assuming $47,401 MSRP): $1,896
- Average car insurance premium: $1,581
- Annual cost of gas: $2,247
- Average car repair costs: $378
- Total costs for 1 year of ownership: $23,897
13. Iowa
- Sales tax (assuming $47,401 MSRP): $2,370
- Average car insurance premium: $1,321
- Annual cost of gas: $2,259
- Average car repair costs: $360
- Total costs for 1 year of ownership: $24,106
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14. Maine
- Sales tax (assuming $47,401 MSRP): $2,607
- Average car insurance premium: $1,116
- Annual cost of gas: $2,349
- Average car repair costs: $349
- Total costs for 1 year of ownership: $24,218
15. North Dakota
- Sales tax (assuming $47,401 MSRP): $2,370
- Average car insurance premium: $1,419
- Annual cost of gas: $2,272
- Average car repair costs: $365
- Total costs for 1 year of ownership: $24,222
16. Mississippi
- Sales tax (assuming $47,401 MSRP): $2,370
- Average car insurance premium: $1,606
- Annual cost of gas: $2,118
- Average car repair costs: $394
- Total costs for 1 year of ownership: $24,284
17. Ohio
- Sales tax (assuming $47,401 MSRP): $2,726
- Average car insurance premium: $1,023
- Annual cost of gas: $2,477
- Average car repair costs: $354
- Total costs for 1 year of ownership: $24,376
18. Wisconsin
- Sales tax (assuming $47,401 MSRP): $2,370
- Average car insurance premium: $1,499
- Annual cost of gas: $2,380
- Average car repair costs: $361
- Total costs for 1 year of ownership: $24,406
19. Missouri
- Sales tax (assuming $47,401 MSRP): $2,005
- Average car insurance premium: $2,104
- Annual cost of gas: $2,207
- Average car repair costs: $379
- Total costs for 1 year of ownership: $24,491
20. Idaho
- Sales tax (assuming $47,401 MSRP): $2,844
- Average car insurance premium: $1,121
- Annual cost of gas: $2,358
- Average car repair costs: $389
- Total costs for 1 year of ownership: $24,508
Methodology: To generate these rankings, GOBankingRates surveyed and totaled the cost of buying and owning a car for one year in all 50 states. This total included four key car expenses: (1) car sales tax, based on rates provided by PolicyGenius; taxes were based on the average car transaction amount of $47,401 in January 2024, as reported by Kelley Blue Book; (2) average annual car insurance premiums, sourced from CarInsurance.com’s 2023 report; (3) average annual gas expenses, based on an average of historical regular gas prices in each state sourced from AAA’s Fuel Gauge Report on March 5, 2024; the expense was calculated based on the assumption of a driver filling up a 14-gallon tank once a week; (4) average annual car maintenance and repair costs, sourced from CarMD’s 2022 State Repair Cost Rankings. These expenses were combined with the cost to finance a new vehicle — based on $47,401 MSRP, 20% down payment of $9,480, an average credit score of 716 as sourced from Experian, an interest rate of 6.88%, as sourced from Experian, loan length of 60 months, which equals to $693 per month or $8,316 per year — to determine the cost to own a car for a year. GOBankingRates also attempted to calculate for title and registration fees, but with such varying degrees between states’ car excise and personal property tax laws as well as rules for weight of vehicles, age of vehicle and the cost of the vehicle; GOBankingRates decided to not to include these fees in its final ranking. All data is up to date as of March 5, 2024.
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This article originally appeared on GOBankingRates.com: The 20 Most (and 20 Least) Expensive States To Own a Car
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