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Open the Calculator →What Is California Sales Tax?
California sales tax is a consumption tax collected by retailers on taxable sales of tangible personal property and certain services within the state. The tax is administered by the California Department of Tax and Fee Administration (CDTFA), which collects over $90 billion annually to fund state and local services including transportation, public safety, schools, and social programs.
Unlike a flat national VAT system, California's sales tax is a multi-layer structure — a combination of a mandatory statewide rate plus optional local district taxes that cities and counties may levy through voter approval.
California Sales Tax Rate Structure (2025–2026)
The California statewide base sales tax rate is 7.25%. This is not a single flat tax — it's composed of several layers:
- 6.00% — State sales and use tax (goes to the state General Fund)
- 0.25% — Local revenue fund (local public safety services)
- 0.25% — Local transportation fund
- 0.75% — Uniform local tax (distributed to cities and counties)
On top of this 7.25% base, local districts may add their own rates ranging from 0.10% to 2.00%. These are approved by voters and fund specific local priorities. Some areas have multiple overlapping district taxes, which is why rates can reach as high as 11.25% in cities like Lancaster and Palmdale (Los Angeles County).
Which California Cities Have the Highest Sales Tax?
As of April 2026, the highest combined sales tax rates in California are found in:
- Lancaster (Los Angeles County) — 11.25%
- Palmdale (Los Angeles County) — 11.25%
- Compton, Bell, Bell Gardens, Lynwood (LA County) — 10.75%
- Alameda, Albany, Dublin, Fremont, Hayward, Newark, Oakland, San Leandro, Union City (Alameda County) — 10.75%
Which California Cities Have the Lowest Sales Tax?
The minimum combined rate in California is the statewide base of 7.25%, found in areas without any additional local district taxes. Examples include:
- Alturas (Modoc County)
- Auburn, Lincoln, Colfax (Placer County)
- Many rural unincorporated county areas
What Items Are Exempt from California Sales Tax?
California law exempts several important categories from sales tax. These exemptions reflect public policy choices to reduce the tax burden on essential goods.
Food and Grocery Exemptions
Most unprepared food items are exempt from California sales tax. This includes fruits, vegetables, bread, dairy products, baby formula, non-carbonated sports drinks, and granola bars. The key distinction is whether the food is "prepared" (ready to eat, especially if hot) or "unprepared" (raw ingredients for home cooking).
Taxable food items include: hot prepared foods, restaurant meals, soda and carbonated beverages, alcohol, and candy.
Medical and Health Exemptions
Prescription medications are fully exempt from California sales tax. This includes drugs prescribed by a licensed physician, insulin, and medical oxygen. Over-the-counter medicines (like aspirin or cough syrup) are generally taxable — unless prescribed by a physician and purchased from a pharmacist.
Since January 1, 2020, diapers and menstrual hygiene products have been permanently exempt from California sales tax, per AB 92.
Other Notable Exemptions
- Qualifying wheelchairs, crutches, and mobility aids (if prescribed)
- Seeds and plants used to grow food for human consumption
- Livestock and poultry for human consumption
- Sales to the U.S. Government
- Manufacturing and R&D equipment (partial exemption)
- Qualifying nonprofit organization purchases
How California Sales Tax Rates Change Over Time
The CDTFA updates tax rates quarterly: January 1, April 1, July 1, and October 1. Local district taxes are the most common driver of changes — they can be added, modified, or allowed to expire following local ballot measures.
In November 2024, California voters approved several district tax changes, which took effect in April 2025 and July 2025. Cities like Fontana, Moreno Valley, Escondido, and Davis raised rates by up to 1 percentage point.
California Sales Tax for Businesses: Compliance Guide
Do You Need a Seller's Permit?
If you sell or lease tangible personal property in California, or provide certain taxable services, you are generally required to hold a California seller's permit. You must register with the CDTFA before you begin making taxable sales. Registration is free at cdtfa.ca.gov.
Economic Nexus for Out-of-State Sellers
Following South Dakota v. Wayfair (2018), out-of-state sellers must collect and remit California sales tax if their annual California sales exceed $500,000. Marketplace facilitators (like Amazon, Etsy, and eBay) are required to collect and remit tax on behalf of third-party sellers.
Filing Frequency and Deadlines
The CDTFA assigns filing frequency based on your sales volume:
- Monthly — Businesses with large tax liabilities (due last day of the following month)
- Quarterly — Most businesses (due last day of the month after quarter ends)
- Annually — Small businesses with low tax liabilities
California Use Tax: What It Is and When It Applies
Use tax is the complement to sales tax. It applies when you purchase tangible goods from an out-of-state seller who does not collect California sales tax — for example, buying from an online retailer that isn't registered in California. The use tax rate equals the sales tax rate for your location.
Individuals report use tax on their California income tax return (Form 540). Businesses report it on their sales and use tax return filed with the CDTFA.
Is Shipping Taxable in California?
Shipping charges in California are not taxable if they are:
- Separately stated on the invoice
- Reasonable in amount (not inflated)
- Optional for the customer
However, if shipping and handling are combined into a single charge, or if the shipping charge is part of the price of a taxable item, the entire amount may be taxable. Always itemize shipping separately on invoices.
California Sales Tax for eCommerce Sellers
If you sell goods online and ship to California customers, you may have a sales tax obligation even without a physical presence in the state. The $500,000 economic nexus threshold applies to total California sales (not transactions).
Key points for online sellers:
- Amazon FBA sellers with inventory in California warehouses have physical nexus from day one
- Marketplace facilitators (Amazon, Etsy, eBay, Walmart) collect and remit tax for you on marketplace sales
- Your own website sales still require you to collect and remit tax if you have nexus
- Digital goods and SaaS are generally not taxable in California
How to Look Up Your Exact California Sales Tax Rate
Because rates vary by exact address — not just city or zip code — always verify your precise rate using official sources:
- Our calculator — Use the CalcTaxCA Calculator for instant results by city
- CDTFA Address Lookup — Official CDTFA rate lookup by address
- CDTFA Phone — Call 1-800-400-7115 (TTY: 711)
- CDTFA Quarterly PDF — Download the full city/county rate spreadsheet each quarter
🧮 Calculate California Sales Tax Instantly
Our free calculator covers 150+ California cities with official 2025–2026 CDTFA rates. Includes reverse calculator, bill splitter, and full tax breakdown.
Open the Free Calculator →Frequently Asked Questions
What is the California sales tax rate in 2025?
The statewide base rate is 7.25%. With local district taxes, most California cities have rates between 8% and 10.75%. The highest is 11.25% (Lancaster, Palmdale).
Do you pay sales tax on services in California?
Most services are not taxable in California. Sales tax applies primarily to tangible personal property. Professional services (legal, accounting, consulting), medical services, and most labor are exempt. However, some services involving fabrication or installation of goods may have taxable components.
Are groceries taxed in California?
Most unprepared groceries are exempt. Hot prepared food, soda, alcohol, and candy are taxable.
What happens if I don't collect California sales tax?
Failing to collect and remit sales tax can result in significant penalties including back taxes, interest (currently compounding), and civil/criminal penalties in severe cases. The CDTFA can audit businesses and assess liabilities going back multiple years.