California sales tax is a tax added to most purchases at the point of sale

When you buy something in California, the seller adds a tax to your bill. That tax goes to the state and to your local government. The rate you pay depends on where you are in California — it is not the same everywhere. The state sets a base rate, and then your county and city add their own amounts on top of it.

You do not pay sales tax on everything. Groceries, prescription medications, and some medical equipment are exempt. Most other goods and many services are taxed. The tax is calculated on the sale price before any discounts are applied, and it is collected by the business at checkout.

Key Takeaways

  • California's state sales tax rate is 7.25 percent, but your actual rate is higher because counties and cities add their own taxes on top.
  • Sales tax rates vary by location within California, ranging from 7.25 percent to over 10 percent depending on your county and city.
  • Groceries, prescription drugs, and certain medical items are not taxed, but prepared food, candy, and soft drinks are.
  • The tax is added at the register and collected by the business, which then sends it to the state and local tax authorities.

How the tax rate is built in your area

The state of California collects 7.25 percent on most sales. On top of that, your county adds a rate, and then your city or district may add more. A purchase in Los Angeles, for example, is taxed at 9.5 percent total — the 7.25 percent state rate plus 2.25 percent from Los Angeles County and the city. A purchase in San Francisco is taxed at 8.625 percent. The same item costs different amounts in tax depending on which city you buy it in.

You can find your exact local rate by entering your address on the California Department of Tax and Fee Administration website, or by asking the business where you are shopping. The rate can change if you cross a city or county line, even if you are buying the same thing.

What is taxed and what is not

Most physical items are subject to sales tax. Clothing, electronics, furniture, and tools are all taxed. Services like haircuts, repairs, and cleaning are usually taxed as well, though some services are exempt depending on the type of work.

Food you buy at a grocery store to cook at home is not taxed — this includes bread, milk, vegetables, meat, and canned goods. However, prepared food is taxed. If you buy a sandwich from a deli counter, a rotisserie chicken, or food from a restaurant, you pay sales tax. Candy and soft drinks are also taxed, even in a grocery store, because they are not considered food staples.

Prescription medications are not taxed. Over-the-counter medications like pain relievers and cold medicine are taxed. Medical equipment prescribed by a doctor, such as wheelchairs or oxygen equipment, is usually not taxed, but you may need to provide documentation.

How sales tax is collected and where it goes

The business collects the tax from you at the point of sale. The cashier or online checkout adds it to your total. The business holds that money and sends it to the state and local tax authorities on a regular schedule — usually monthly or quarterly, depending on the business size and type.

The state keeps its 7.25 percent share. The county and city keep their portions. These funds go into general budgets that pay for schools, roads, public safety, and other local services. The business does not keep any of the tax money — it is acting as a collector on behalf of the government.

Sales tax on online purchases

Online retailers must collect and send sales tax on purchases shipped to California addresses. This applies whether the retailer has a physical location in California or not. The tax rate is based on the delivery address, not where the business is located.

If you order from an out-of-state seller who does not collect California sales tax at checkout, you may owe use tax on that purchase. Use tax is a backup tax that applies when sales tax was not collected. Most people do not pay it voluntarily, but it is technically owed. Some states and the federal government are working to make this collection more automatic, but for now it remains largely uncollected on individual purchases.

Special situations and exemptions

Certain organizations do not pay sales tax on their purchases. Nonprofits, schools, and government agencies can provide a resale certificate or exemption certificate to avoid paying tax on items they buy for their operations. This is not available to individual shoppers.

If you are buying items to resell — for example, if you are a small business buying inventory — you can provide a resale certificate to the seller and avoid paying sales tax on that purchase. You will collect sales tax from your customers instead. This requires registering with the California Department of Tax and Fee Administration.

Some counties have temporary sales tax holidays for specific items like school supplies or energy-efficient appliances, though these are not annual events. Check your local government website to see if any are currently running.

What happens if sales tax is not collected

If a business fails to collect sales tax that it should have, the business is responsible for paying it to the state, not the customer. If you discover that you were not charged tax on a taxable item, you do not owe it retroactively. The state pursues businesses that do not collect and remit taxes properly.

If you overpay sales tax — for example, if a cashier rings up the wrong amount — you can ask for a refund from the business at the time of purchase. Most businesses will correct the error immediately. You cannot claim a refund from the state for sales tax you paid to a business.

Frequently Asked Questions

Is sales tax the same everywhere in California?

No. The state rate is 7.25 percent, but counties and cities add their own taxes. Your total rate depends on your location and can range from 7.25 percent to over 10 percent. Use the California Department of Tax and Fee Administration's rate lookup tool to find your exact rate.

Do I pay sales tax on groceries?

You do not pay tax on unprepared food you buy at a grocery store — bread, produce, meat, dairy, and canned goods are all exempt. Prepared foods like deli sandwiches, rotisserie chicken, and restaurant meals are taxed. Candy and soft drinks are also taxed.

Why is sales tax added after I see the price?

California law allows businesses to display prices without including the tax. The tax is calculated and added at checkout based on your location. This is different from some other states that require the tax to be included in the displayed price.

Do I owe tax on items I buy online from out-of-state sellers?

Most large online retailers now collect California sales tax automatically. If a seller does not collect it, you technically owe use tax on the purchase, though this is rarely enforced for individual shoppers. The tax rate is based on your delivery address in California.

Can I get a refund if I overpaid sales tax?

Ask the business for a refund at the time of purchase — most will correct the error immediately. You cannot claim a refund from the state. If the business refuses to correct an obvious error, you can contact the California Department of Tax and Fee Administration to report it.