If you have a newer car, you may be in for some sticker shock when you renew your Minnesota license tabs. That’s because the formula for calculating fees has changed due to a 2023 bill.

If your car is less than five years old, you could even be seeing tab prices go up year over year.

Jeff Craig drives a Subaru Forester. He bought it used, but was shocked when he renewed his tabs.

“We paid the tab on it for the first time and the next year it was more expensive,” Craig said.

The new formula means the average driver paid $178 in registration taxes this year — a 20% increase. Craig thinks it unfair.

“The car depreciates, but the tax goes up? Really? Is that how that’s supposed to work? I don’t thing so,” he said.

But the 2023 bill didn’t just change the state’s overall formula for calculating license tab fees; it also changed the way it calculates the depreciation of your vehicle.

The state calculates that your new car loses 5% of its value a year, so 10% over two years. The Kelley Blue Book estimates that over two years, the average new car loses 30% of its value. 

GOP state Sen. John Jasinski has a bill to roll back the changes.

“People are frustrated. It’s just very expensive,” Jasinski said. “You’re paying a lot more up in the first couple years now, and it’s very expensive on a new car.” 

But the state says tabs for older cars are going down, and that many Minnesota drivers will pay less. And If you can hang onto your car for 11 years, your renewal cost is a flat $35 plus taxes and fees.

The bill to roll back the changes is moving forward in the GOP-controlled House, but it’s stalled in the state Senate.