Starting this October, many vehicle owners in Alabama may have to pay more for their car tags. The Alabama Department of Revenue (ADOR) has announced that vehicle registration fees are going up because of an increase in car values.
The reason behind the fee hike is simple: the market value of many vehicles has increased, especially after the COVID-19 pandemic.
Due to supply chain problems and shortages of new cars in the past few years, the prices of used cars have also gone up. These higher values are now being reflected in the registration fee system.
In Alabama, vehicle registration fees are based on the current market value of your car. So, if your vehicle is worth more today than it was last year, you’ll likely pay a higher fee when you renew your tag. The new rates will apply to all vehicle tags renewed on or after October 1, 2025.
The Alabama Department of Revenue updates vehicle values every year using a system that calculates average prices for different makes and models.
These updated values are then used to determine your tag fee. This year’s changes will impact thousands of car owners across the state.
For example, if you own a popular SUV or truck model that holds its value well, you might notice a bigger jump in your tag fee compared to someone with an older or lower-value car.
The ADOR has said that not every vehicle will be affected the same way, and in some cases, the change may be small.
The fee increase is not a new tax or additional charge—it’s simply a result of the vehicle’s higher market value. However, it could still come as a surprise to many Alabamians when they go to renew their tags later this year.
To check your vehicle’s current market value and get an estimate of your tag fee, you can visit the official Alabama Department of Revenue website or contact your local licensing office.
Alabama law requires all vehicles to be registered annually. These registration fees help fund road maintenance, local government services, and other transportation needs in the state.