California Sales
Tax Rate

California sales tax starts with a statewide base rate of 7.25 percent in 2026. Many cities and counties add district taxes, so the combined rate paid on a taxable purchase can be higher depending on the location of the sale or where the item is delivered or used.

The California Department of Tax and Fee Administration, commonly called the CDTFA, administers the state's sales and use tax system. Retailers must determine whether a sale is taxable, identify the correct location-based rate and collect or report the required tax when California law applies.

What Is the California Sales Tax Rate in 2026?

The statewide California sales and use tax rate is 7.25 percent. Local district taxes can raise the combined rate in a specific city or county.

The CDTFA states that district tax rates can range from 0.10 percent to 2.00 percent. More than one district tax can apply in the same location. This is why there is no single combined California sales tax rate that works for every address.

Rates in several major California cities effective July 1, 2026 include:

The CDTFA's July 1, 2026 rate table lists these combined city rates.

These rates can change when local district taxes change. The correct rate should be checked for the specific transaction location rather than assumed from a statewide average.

How Do You Calculate Sales Tax in California?

Calculate California sales tax by multiplying the taxable purchase price by the combined sales and use tax rate that applies to the transaction.

The basic formula is:

Sales Tax = Taxable Purchase Price x Combined Tax Rate

For example, if a taxable item costs $100 and the applicable combined rate is 9.75 percent, the sales tax is $9.75. The total amount paid is $109.75.

A California sales tax calculator therefore needs two main pieces of information:

• The taxable amount of the purchase.
• The correct sales and use tax rate for the location.

The location matters because district taxes differ among cities and counties. The CDTFA also warns that a mailing address or ZIP code alone may not always identify the correct rate. Its address-based lookup can provide a more precise result for a specific California address.

Why Does California Sales Tax Vary by City and County?

California sales tax varies because the 7.25 percent statewide rate can be supplemented by district taxes approved in cities or counties. A location can also fall within more than one taxing district.

For a taxable sale, the final rate may include the statewide rate plus applicable county or city district taxes. This creates meaningful differences across California.

For example, the CDTFA's rates effective July 1, 2026 list Los Angeles at 9.75 percent, San Francisco at 8.625 percent, San Diego at 7.75 percent and Sacramento at 8.75 percent.

Businesses should verify the rate that applies to the actual transaction. A seller operating in several jurisdictions should not assume that the rate charged at one location applies to every California customer.

What Purchases Are Subject to California Sales Tax?

Retail sales of tangible personal property in California are generally subject to sales tax unless a specific exemption or exclusion applies.

Tangible personal property generally means physical merchandise that can be seen, weighed, measured, felt or touched. Common taxable items can include furniture, clothing, toys, giftware and many other physical goods.

Some labor or service charges can also become taxable when they are part of creating tangible personal property. By contrast, separately stated repair or installation labor is generally not taxable under the CDTFA rules.

The tax treatment of a transaction can depend on what is sold, how it is delivered and whether a specific exemption applies. Sellers should classify the transaction before applying a rate.

What Is Exempt From California Sales Tax?

California provides full or partial sales and use tax exemptions for certain transactions. Food products for human consumption are one of the best-known examples, although important exceptions apply.

Common examples include:

• Food products for human consumption, subject to exceptions for certain heated food, meals and other situations.
• Certain prescription medicines when the statutory requirements are met.
• Qualifying sales to the U.S. government.
• Certain sales shipped or delivered outside California when the requirements for interstate or foreign commerce are satisfied.
• Specific manufacturing, research and development or agricultural purchases that qualify for partial exemptions.

The CDTFA states that food products for human consumption are generally exempt, but the rule can change for heated food, meals or food consumed at certain seller locations. Prescription medicines can also qualify for nontaxable treatment when the applicable requirements are met.

Exemption rules are transaction-specific. A seller claiming an exemption may also need to retain supporting documentation or an exemption certificate.

Does California Charge Sales Tax on Online Purchases?

Online purchases of tangible merchandise are not automatically exempt from California sales or use tax. The tax result depends on the seller's registration obligations, the type of product and where the merchandise is delivered.

The CDTFA states that there is no general tax exemption for tangible merchandise simply because it is sold over the Internet. A California retailer or remote seller with a California collection obligation may need to collect the applicable tax.

Some electronically transmitted products receive different treatment. The CDTFA generally treats electronically delivered products such as software, digital books, mobile applications and digital images as nontaxable when no tangible copy is provided.

What Is the California Sales Tax Nexus?

Sales tax nexus describes the connection that can require a seller to register and collect California sales or use tax. Nexus may arise from physical business activity in the state or from economic activity that meets California's threshold.

A business can have a physical connection through a California office, sales room, warehouse, representative or other qualifying activity.

California also applies an economic nexus rule to remote sellers. A retailer located outside California must generally register with the CDTFA and collect California use tax when total combined sales of tangible personal property for delivery in California exceed $500,000 during the preceding or current calendar year.

The threshold considers total sales of tangible personal property for delivery in California under the CDTFA rules. It can include nontaxable sales when determining whether the threshold has been reached.

How Does California Sales Tax Work for Marketplace Sellers?

A marketplace facilitator is generally treated as the retailer responsible for collecting and paying sales or use tax on qualifying sales that it facilitates for delivery to California customers.

This rule can apply to sales made through online marketplaces. A marketplace seller whose sales are fully handled by a registered marketplace facilitator may not have to collect the tax on those facilitated transactions.

A seller can still have separate California obligations if it makes direct sales through its own website or has physical or economic nexus with the state. Sellers that use both marketplaces and direct sales channels should evaluate each channel separately.

Who Needs a California Seller's Permit?

A seller generally needs a California seller's permit when the seller is engaged in business in California and intends to sell or lease tangible personal property that would ordinarily be subject to sales tax at retail.

The requirement can apply to individuals, corporations, partnerships and limited liability companies. Both wholesalers and retailers can need a permit.

Out-of-state sellers can also have a registration obligation when they have sufficient physical presence or exceed California's economic nexus threshold.

What Is the Difference Between California Sales Tax and Use Tax?

Sales tax generally applies to retail sales of merchandise made in California. Use tax generally applies when taxable tangible personal property is purchased without California tax being collected then stored, used or consumed in California.

For example, a California consumer may buy taxable merchandise from an out-of-state seller that does not collect California tax. The consumer can still owe use tax if the property is used in California.

Businesses with a California seller's permit generally report business-related purchases subject to use tax on their sales and use tax return.

California Sales Tax vs. California Income Tax

California sales tax applies to taxable transactions involving goods or certain other purchases. Income tax is based on taxable income, so the two systems serve different purposes and use different rules.

A retailer may have sales tax responsibilities through the CDTFA while an individual or business also has separateCalifornia income tax obligations.

Sales tax is also not an employee payroll deduction. It should not be grouped with federal withholding, Social Security, Medicare or California payroll deductions when reviewing employee compensation.

Is Sales Tax Shown on a California Pay Stub?

California sales tax is not an employee payroll tax, so it normally does not belong among the deductions used to calculate an employee's net pay. A pay stub focuses on wages, payroll taxes and deductions tied to compensation.

For example, aCalifornia pay stub can show gross earnings, California income tax withholding, Social Security, Medicare, State Disability Insurance and other applicable payroll deductions. Sales tax belongs to a different tax system because it is connected with taxable transactions rather than employee wages.

Keeping the two categories separate makes payroll records easier to understand and reduces the risk of treating a business sales tax obligation as an employee deduction.

How Businesses Can Check the Correct California Sales Tax Rate

Businesses should verify the current rate for the actual sales location or delivery address because California district taxes can change the combined rate.

The CDTFA provides current city and county rate listings plus an address-based lookup tool. This is particularly useful for retailers that sell into several California jurisdictions.

A practical process is:

• Determine whether the transaction is taxable.
• Identify the location that controls the rate.
• Check the current combined sales and use tax rate.
• Apply the rate to the taxable amount.
• Keep records supporting the tax collected or the exemption claimed.

Rate changes can become effective at the start of a new calendar quarter. Sellers should review current CDTFA information rather than relying on an old rate table.

Manage Payroll Records Separately From Sales Tax

Sales tax compliance and payroll recordkeeping are separate business responsibilities. If your business also pays employees or maintains genuine wage records, you can use ourpaystub generator to organize accurate earnings, tax and deduction information into a professional pay stub.

Online PayStub is intended for lawful payroll, business and recordkeeping purposes. The information entered should reflect genuine employer, employee, earnings, tax and payment records.