Quick Answer
California sales tax is imposed on the gross receipts from the retail sale of tangible personal property in California under Revenue and Taxation Code §6051. The base rate is 7.25%, with local and district add-ons bringing the total rate to 7.25% to 10.75% depending on location. The short version is that California sales tax is administered by the California Department of Tax and Fee Administration (CDTFA), which replaced the Board of Equalization for most sales tax functions in 2017. Retailers collect sales tax from customers at the point of sale and remit it to CDTFA quarterly or monthly depending on volume. Use tax applies to purchases made without sales tax (typically out-of-state or online purchases).1
Facing CDTFA sales tax issues? A 15-minute consultation is free.
California sales tax is a major compliance burden for retailers — collection, reporting, and remittance on every qualifying transaction. Understanding how it works is the foundation for managing any CDTFA matter. This chapter walks through the four components of California sales tax (base, district, state, and use tax) and how each applies.
Our firm handles CDTFA matters regularly. For audit triggers, see What Triggers a Sales Tax Audit. For audit process, see Sales Tax Audit Process.
If you received a California CDTFA audit notice or sales tax assessment:
California sales tax audits are detailed and methodical. CDTFA auditors are trained to identify unreported transactions and missing exemption documentation. A free 15-minute call covers what the CDTFA is looking for, whether your records support your reported figures, and what protest and appeal look like.
Talk to Sam — Free 15-Minute Call → Or call: (619) 378-3138
The Four Components of California Sales Tax
| Component | Rate | Applies To2 |
|---|---|---|
| State Base | 7.25% | Tangible personal property retail sales |
| District Tax | 0.125% to 3.5% | Local district add-ons by city/county |
| Use Tax | Same as sales tax rate | Purchases without CA sales tax paid |
| Special | Various | Aviation, fuel, specific industries |
Quick Reference
Jump to component: state base, district tax, use tax, or special rates. For document lookup, see the CDTFA document reference. To discuss, a 15-minute consultation is free.
1. State Base Rate: 7.25%
The California state sales tax base rate is 7.25%, composed of a state portion (6.00%) and a state-level add-on (1.25%). Applied to gross receipts from retail sales of tangible personal property.
If this is you: Retail business in California. Base rate is 7.25%. District add-ons increase the combined rate in most jurisdictions.
State Base Collection Strategy
- Register with CDTFA. Obtain seller's permit.
- Collect sales tax at point of sale.
- File sales tax returns quarterly or monthly. Volume-based.
- Remit collected tax to CDTFA.
- Track exemption certificates for non-taxable sales.
2. District Tax: Local Add-Ons
California district taxes are local sales taxes imposed by cities, counties, and special districts on top of the state rate. Range from 0.125% to 3.5%, bringing total rates to 7.25% to 10.75%.
If this is you: Your location has a district tax. Total rate includes state + district. Rates vary by sale location. Ship-to address drives the rate for delivered sales.
California Sales Tax Rates by Major County / City (2025)
The table below shows combined state + district rates for major California locations. Rates change quarterly. For any specific address, use the CDTFA rate lookup tool to confirm the current rate before filing or remitting.
| County / City | Total Rate | District Add-On |
|---|---|---|
| San Diego (city) | 7.75% | 0.50% |
| La Mesa, National City (San Diego Co.) | 9.25% / 9.00% | 2.00% / 1.75% |
| Los Angeles (city) | 10.25% | 3.00% |
| Orange County (unincorporated) | 7.75% | 0.50% |
| Riverside (city) | 8.75% | 1.50% |
| San Bernardino County (unincorporated) | 7.75% | 0.50% |
| San Francisco | 8.625% | 1.375% |
| Oakland / Alameda County | 10.25% | 3.00% |
| San Jose / Santa Clara County | 9.375% | 2.125% |
| Sacramento (city) | 8.75% | 1.50% |
| Fresno (city) | 8.35% | 1.10% |
| Bakersfield / Kern County | 8.25% | 1.00% |
| Ventura County (unincorporated) | 7.25% | 0.00% |
Most CDTFA audits focus on whether the correct district tax rate was applied to the correct ship-to address — not whether the state base rate was collected. If you applied a uniform statewide rate to all California sales, that is a common audit trigger for multi-location retailers.
3. Use Tax
California use tax applies to the use, storage, or consumption of tangible personal property in California on which California sales tax was not paid. Out-of-state purchases, online purchases from non-registered sellers, and certain business-use acquisitions all trigger use tax.
If this is you: You purchased goods out-of-state or online without California tax. Use tax is owed. Businesses report on CDTFA return; individuals on California income tax return.
4. Special Rates and Industries
Certain industries have special sales tax rates or rules — aviation fuel, cannabis, manufacturing equipment exemptions, and others.
If this is you: Industry-specific rates apply. Cannabis businesses have complex rates and excise taxes. Manufacturing equipment can qualify for partial exemption under RTC §6377.1.
CDTFA audit or notice? Sales tax compliance is complex. Early engagement produces better outcomes. Book a consultation before the CDTFA escalates.
CDTFA Document Lookup
| Document | Purpose |
|---|---|
| Form BOE-401-A2 | Quarterly Sales and Use Tax Return |
| Form CDTFA-230 | General Resale Certificate |
| Form CDTFA-345-SP | Notice of Determination (audit assessment) |
| Form CDTFA-38 | Application for Seller's Permit |
| Publication 34 | Motor Vehicle Dealers |
| Publication 17 | Appeals Procedures |
| Revenue and Taxation Code §6051 | Sales tax statute |
| CDTFA Regulation 1700 | Reimbursement for sales tax |
CDTFA Statute of Limitations
- Standard: 3 years. From the due date of the return.
- Substantial understatement: 8 years. When returns underreport by 25%.
- Fraud or no return filed: no limit.
- Refund claim: 3 years. From overpayment.
- Waiver via Form CDTFA-122. Voluntary extension.
CDTFA Audit Selection Context
| Factor | Audit Risk |
|---|---|
| High gross receipts without tax collection | Elevated |
| Cash-intensive business | Elevated |
| Industry-specific risk (construction, auto, restaurants) | Elevated |
| Resale certificate use | Elevated |
| Out-of-state retailer nexus | Elevated |
CDTFA Matter Escalation Pathway
Return Filing to Audit
CDTFA reviews returns for anomalies. Selection triggers desk review or field audit.
Audit to Assessment
Assessment issues as Notice of Determination. Taxpayer has 30 days to petition for redetermination.
Appeals
CDTFA Appeals, then Office of Tax Appeals (OTA), then Superior Court for judicial review.
The First 48 Hours of CDTFA Notice
- Identify the notice type. Audit, deficiency, delinquent return, levy.
- Pull the CDTFA account summary.
- Calendar any deadlines. 30-day petition window.
- Gather relevant records. Sales records, purchase invoices, resale certificates.
- Engage counsel for audit or large assessment.
The ROI Question
CDTFA sales tax audits can produce assessments of $100,000 to several million dollars. Professional representation in CDTFA audits typically saves multiples of the representation fee through sampling challenges, documentation, and negotiation.
When to Engage an Attorney for CDTFA Matters
- Audit notice received.
- Assessment over $50,000.
- Nexus question. Out-of-state retailer.
- Resale certificate audit.
- Criminal referral.
- Prior audit with unpaid balance.
Any of the above apply?
A 15-minute consultation is free. We scope representation.
Get a Candid Assessment — Free →Frequently Asked Questions
What is California sales tax?
A tax on the gross receipts from retail sales of tangible personal property in California under Revenue and Taxation Code §6051. Base rate 7.25%, with local district add-ons bringing the total to 7.25% to 10.75% depending on location. Administered by CDTFA.
What is the California state sales tax rate?
7.25% base statewide. District taxes (local) add 0.125% to 3.5% on top. Total rates range from 7.25% (few locations) to 10.75% (Los Angeles and similar high-rate jurisdictions). Ship-to address typically drives the rate.
Who must collect California sales tax?
Every seller of tangible personal property in California. Retailers, wholesalers that make retail sales, out-of-state sellers with California nexus. Seller's permit required before making taxable sales. Certain services and intangibles are not subject to sales tax.
What is the difference between sales tax and use tax?
Sales tax is collected by sellers on in-state retail sales. Use tax applies to purchases where California sales tax was not paid (out-of-state, online from non-registered sellers, certain business-use acquisitions). Same rate but different trigger. Purchasers owe use tax when sales tax was not collected.
What is CDTFA?
California Department of Tax and Fee Administration. Replaced the Board of Equalization for most sales tax administrative functions in 2017. Administers sales tax, use tax, fuel tax, cannabis tax, and similar business taxes. The Board of Equalization retains property tax functions.
What is a California seller's permit?
The registration required before making taxable retail sales in California. Applied for via Form CDTFA-38 (or online). Free to obtain. Required for every physical location where sales occur. Must be displayed at the business location.
How often do I file California sales tax returns?
Depends on volume. Quarterly for most retailers. Monthly for high-volume retailers. Annual for very low-volume. CDTFA assigns the filing frequency based on prior-year tax. Form BOE-401-A2 is the standard sales tax return.
What is a California resale certificate?
Form CDTFA-230 documentation from a retail purchaser stating the purchase is for resale, not consumption. Exempts the transaction from sales tax collection. Issuer assumes responsibility for collecting sales tax on the eventual retail sale. Resale certificate audits are a frequent CDTFA focus.
Do I owe California sales tax on online sales?
Yes, if you have California nexus (physical presence, economic thresholds, or marketplace facilitator rules). Post-Wayfair, California's economic nexus threshold is $500,000 of annual sales. Marketplace facilitators (Amazon, eBay) collect sales tax on behalf of third-party sellers in most cases.
Are services subject to California sales tax?
Generally no. California sales tax applies to tangible personal property, not services. Exceptions exist — services that create or transfer tangible personal property (repair work producing something tangible), labor that fabricates or modifies property. Most pure services are not taxable.
What is a California sales tax exemption?
Specific categories of sales that are not subject to sales tax: food for home consumption, prescription medicine, certain farming products, manufacturing equipment (partial exemption under RTC §6377.1), and others. See the California Sales Tax Exemption chapter.
What happens if I don't collect California sales tax?
The retailer is liable for the uncollected tax plus penalties and interest. CDTFA audits sales tax collections and can assess retroactively for up to 3 years (8 years for substantial understatement, unlimited for fraud or non-filing). Assessments can quickly exceed the business's cash flow.
Can I appeal a CDTFA assessment?
Yes. Petition for redetermination within 30 days of the Notice of Determination. CDTFA Appeals handles the first review. Further appeal to Office of Tax Appeals (OTA), then to Superior Court for judicial review. See our separate chapter on How to File a California Sales Tax Audit Appeal.
Next Steps in This Guide
If you need CDTFA representation, a 15-minute consultation is free.