Used Cars: new car rebates, new car rebates, down payments

Question
Hey Shane,
I recently went shopping for a new vehicle(mazda 5'09), and when discussing rebates with the sales man was told that those come off after taxes and fees. Is this common practice or law in michigan, or can i request to subtract the rebate from the agreed sale price of the vehicle?

thanks, steve

Answer
Hi Steve,thanks for the question. In this case the salesman is correct. The state collects tax based on the sales price not the bottom line after down payments.  The rebates are no different than a mail-in rebate from a grocery store.  The biggest benefit obviously is that you can use it immediately. Simply put the rebate is considered down payment and not price reduction.
Hope this helps, good luck with the new car!  Shane