California's sales tax rate and what it covers
California's statewide sales tax is 7.25 percent. When you buy most goods at a store, that percentage gets added to your bill at checkout. The 7.25 percent is a base rate set by the state, but your actual rate depends on where you live — your city or county may add extra tax on top of it, so your total could be 7.25 percent or higher.
Sales tax applies to tangible goods: clothing, groceries, electronics, furniture, gas. It does not apply to services like haircuts, car repairs, or doctor visits. Some goods are taxed differently — for example, groceries are generally not taxed, but prepared food and soda are.
You pay sales tax when you buy something in a store or online if the seller has a physical location in California or meets certain sales thresholds. The seller collects the tax from you and sends it to the state and local tax authorities.
Key Takeaways
- California's base sales tax is 7.25 percent, but your actual rate is higher if your city or county adds local tax on top of it.
- Sales tax applies to goods like clothing and electronics, but not to most services or unprepared groceries.
- The seller collects sales tax at the point of sale and remits it to state and local authorities.
- Online purchases are taxed the same way as in-store purchases if the seller has a California presence or meets sales thresholds.
- Your receipt shows the tax amount separately, and you can verify it matches your local rate.
How local tax rates work in your area
Every California city and county can add its own sales tax on top of the state's 7.25 percent. These local rates vary widely. Some areas add 1 percent, others add 2 percent or more. Your total sales tax rate is the sum of the state rate plus all local rates that apply to your address.
To find your exact rate, you need to know your city and county. The California Department of Tax and Fee Administration publishes a complete list of rates by location. You can search by zip code or city name on their website. Your receipt also shows the tax rate that was applied.
Local tax money goes to cities, counties, and special districts for schools, roads, and public services. The rate you pay depends on where the purchase happens, not where you live — so buying something in a neighboring city with a lower rate will result in lower tax.
What is and is not subject to sales tax
Most physical items are taxable: clothing, shoes, toys, books, furniture, appliances, and cars. Gasoline is taxed. Prepared food — pizza, sandwiches, coffee — is taxed. Soda and energy drinks are taxed.
Groceries are generally not taxed. This includes bread, milk, vegetables, meat, and canned goods you buy at a grocery store to cook at home. However, hot prepared foods, candy, and certain beverages are taxed even if bought at a grocery store.
Services are not taxed. A haircut, dental work, car repair, plumbing, or medical visit has no sales tax. Rent is not taxed. Utilities are not taxed. Prescription medications are not taxed, but over-the-counter drugs and vitamins are.
The line between taxable and non-taxable can be unclear in specific cases. When in doubt, ask the seller before you buy, or check your receipt after to see whether tax was charged.
Sales tax on online and out-of-state purchases
If you order something online from a California seller, you pay California sales tax. If you order from an out-of-state seller, the rule depends on whether that seller has a physical presence in California or meets a sales threshold. Most large online retailers now collect California sales tax on all orders shipped to California addresses.
If you buy something in another state and bring it home to California, you do not pay California sales tax at the time of purchase. However, California law requires you to pay "use tax" on that item — it is the same rate as sales tax. In practice, most people do not report use tax on small personal purchases, but it is technically owed.
If you order from a small out-of-state seller who does not collect California tax, the tax is still legally owed but is rarely enforced for individual purchases. Large purchases or regular orders may trigger a notice from the state.
How to read your receipt and verify the tax
Your receipt shows the subtotal (the price before tax), the tax amount, and the total (subtotal plus tax). The tax line usually shows the rate as a percentage. You can verify the math by multiplying the subtotal by the tax rate — the result should match the tax amount shown.
If you think the tax is wrong, check that the rate matches your local rate. Search the California Department of Tax and Fee Administration website for your city or zip code. If the rate on your receipt is higher than your area's rate, ask the store to correct it. If it is lower, the store may have applied an incorrect rate, and you can report it.
Keep your receipt if you need to return an item. When you return something, the store refunds the tax along with the purchase price, so you get back the full amount you paid including tax.
Special situations and exemptions
Certain organizations and people are exempt from paying sales tax in specific situations. Non-profit organizations, schools, and government agencies may not pay tax on purchases for their operations — they provide a resale certificate or exemption certificate to the seller. If you work for such an organization, you cannot use their exemption for personal purchases.
Resellers — people who buy goods to resell them — do not pay sales tax on their purchases if they provide a resale certificate. They collect tax from their customers instead. This prevents tax from being charged twice on the same item.
Some items are exempt for specific reasons. For example, certain medical equipment and mobility aids are not taxed. Prosthetics and hearing aids are exempt. If you use medical equipment regularly, ask your provider whether it qualifies for an exemption.
Frequently Asked Questions
What is the difference between sales tax and use tax?
Sales tax is charged when you buy something in California. Use tax is charged on items you buy outside California and bring into the state, or buy from out-of-state sellers who do not collect California tax. Both are the same rate, but use tax is your responsibility to report and pay — the seller does not collect it.
Why is my sales tax rate different from the 7.25 percent I heard about?
The 7.25 percent is California's state rate only. Your city and county add local tax on top of it. If you live in an area with 1.5 percent local tax, your total is 8.75 percent. Search your zip code on the California Department of Tax and Fee Administration website to see your exact rate.
Do I pay sales tax on groceries?
Most groceries — bread, milk, vegetables, meat, eggs — are not taxed. Prepared foods like hot pizza or deli sandwiches are taxed. Candy, soda, and energy drinks are taxed. Check your receipt to see which items were taxed.
Can I get a refund of sales tax if I return something?
Yes. When you return an item, the store refunds the full purchase price including the tax you paid. You get back the exact amount you paid at checkout.
Do I have to pay sales tax on items I buy online?
If the online seller has a California location or meets sales thresholds, they collect California sales tax. Most large retailers do this. Some small out-of-state sellers do not, but you are legally responsible for use tax on those purchases.