Government forces have conducted a major operation freeing most of the hostages, but estimate more than 30 are still being held.
The Taliban have so far not commented on the incident in Aliabad district in the volatile province of Kunduz, where the insurgents briefly overran the provincial capital in a stunning military victory last year.
"The Taliban shot dead 16 passengers and they are still holding more than 30 others," said Sayed Mahmood Danish, spokesman for the governor of Kunduz.
The identity of the victims was not immediately clear but a campaign of kidnappings against Shi'ite Hazaras in the past year has became a source of ethnic tension, fuelling concern about sectarian violence.
Since persecuting Hazaras and other minorities during their rule in the 1990s, the Taliban have largely avoided specifically targeting Shi'ite Muslims.
But a rise in Afghanistan in the number of militants claiming allegiance to Islamic State, a hard-line Sunni movement that emphasises purging Shi'ites and is a rival to the Taliban, has coincided with a number of attacks on Hazaras.