California sales and use tax for 2026: the statewide base rate and its parts, district taxes, seller permits, the economic nexus test with related-person and marketplace sales, marketplace facilitators, food, software and SaaS, CDTFA-230 resale certificates, use tax (including Form 540 line 91), filing, prepayments, penalties and interest.
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Built by Michael Cutajar and the OpenAccountants team. Written and source-checked from the official sources it links.
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| Component | Rate | Where it goes |
|---|---|---|
| State | 3.6875% | State General Fund |
| State | 0.25% | State General Fund |
| State | 0.50% | Local Public Safety Fund |
| State | 0.50% | Local Revenue Fund (1991 realignment) |
| State | 1.0625% | Local Revenue Fund 2011 |
| Local (Bradley-Burns) | 0.25% | County transportation funds |
| Local (Bradley-Burns) | 1.00% | City or county operations |
| Total statewide base rate | 7.25% |
Figures are for tax year 2026, as they stand on 25 September 2026. They come from the California Department of Tax and Fee Administration (CDTFA) at cdtfa.ca.gov, the Revenue and Taxation Code (R&TC) on leginfo.legislature.ca.gov, and the Franchise Tax Board (FTB) at ftb.ca.gov. The statewide base rate has been the same since 1 January 2017, so the core rules are the same for 2025 and 2026. A short section at the end covers 2025 periods and 2025 income tax returns.
| Component | Rate | Where it goes |
|---|---|---|
| State | 3.6875% | State General Fund |
| State | 0.25% | State General Fund |
| State | 0.50% | Local Public Safety Fund |
| State | 0.50% | Local Revenue Fund (1991 realignment) |
| State | 1.0625% | Local Revenue Fund 2011 |
| Local (Bradley-Burns) | 0.25% | County transportation funds |
| Local (Bradley-Burns) | 1.00% | City or county operations |
| Total statewide base rate | 7.25% |
| Item | Treatment | Condition that decides it |
|---|---|---|
| Goods (furniture, electronics, clothing, shoes, books, tools, toys) | Taxable | No general clothing exemption |
| Services (professional, advisory, consulting, payroll, tax) | Not taxable | Unless the service is part of a sale of goods |
| Mixed contract, service and property | Depends on the "true object" | If the buyer wants the service itself, not taxable even though some property is handed over; if the buyer wants the property, tax applies to the whole price with no deduction for labor or skill |
| Admissions, finance charges, real property, securities, transportation tickets | Not taxable | Not sales of tangible personal property |
| Prescription medicines | Exempt | Sold under the conditions in Regulation 1591; over-the-counter drugs and medicines are taxable |
| Goods shipped out of California | Exempt | Only if the contract of sale requires shipment to a point outside California and the retailer ships it, in its own vehicles or by delivery to a carrier, customs broker or forwarding agent (even one hired by the buyer). Customer pickup in California does not qualify (R&TC section 6396) |
| Sales to the United States, its unincorporated agencies and instrumentalities, and the American National Red Cross | Exempt | R&TC section 6381 |
| Farm equipment and machinery used primarily to produce and harvest agricultural products | Partly exempt | Buyer must be a qualified person (SIC codes 0111 to 0291, or someone assisting them). Local and district taxes and certain state components still apply (R&TC section 6356.5) |
| Item | Treatment | Condition |
|---|---|---|
| Installation labor for goods sold | Not taxable | Does not cover fabrication of property in place |
| Repair labor | Not taxable | |
| Parts in a repair job | Repairer is the retailer and charges tax on the parts | If the retail value of parts is more than 10% of the total charge, or the parts are charged separately; the repairer must then show parts separately on the invoice |
| Parts in a repair job | Repairer is the consumer and pays tax on its purchase of the parts | If parts are 10% or less of the total charge and not charged separately |
| Fabrication, processing or printing on the customer's own materials | Taxable | Any operation that creates new tangible property, or is a step in doing so |
| Item | Treatment | Condition |
|---|---|---|
| Food products (groceries, bakery goods, snacks) | Exempt | Unless sold as hot prepared food (but see the hot bakery and hot drink exception below), as a meal, or for eating at the seller's facilities |
| Candy, confectionery, chewing gum | Exempt | They are food products |
| Fruit and vegetable juices; noncarbonated, noneffervescent bottled water | Exempt | |
| Carbonated drinks, carbonated or effervescent water, beer, wine and spirits | Taxable | Not food products |
| Ice | Taxable | Not a food product |
| Dietary and food supplements (vitamin pills, protein supplements) | Taxable | Labelled as a supplement or designed to add vitamins, proteins, minerals or calories; exempt only as prescription medicine or a complete dietary food |
| Hot prepared food | Taxable | Sold hotter than the room; a single price for a meal with any hot item is taxable in full |
| Hot bakery goods and hot drinks such as coffee, sold for a separate price | Exempt | Unless taxable under Regulation 1603(b), (c), (d) or (f) (meals, the 80-80 rule, admission places, seller's facilities). A hot drink sold with a bakery item or cold food for a single price is taxable |
| Meals and food served for eating at the seller's tables, at restaurants, or inside places charging admission | Taxable | Regulation 1603(a), (d), (f) |
| Cold food "to go" from a restaurant-type seller | Taxable only under the 80-80 rule | Both: more than 80% of gross receipts are from food, and more than 80% of retail food sales are taxable; the food must also be suitable for eating on the premises. The seller may elect to account separately and exempt these sales |
| Item | Treatment | Condition |
|---|---|---|
| Prewritten (canned) program on storage media (disk, USB drive) | Taxable | Tax applies to the entire amount, including licence fees |
| Prewritten program transferred electronically | Not taxable | Only if the buyer does not obtain any tangible property, such as storage media, in the transaction |
| Custom program | Not taxable | In any form, except a basic operational program; separately stated custom changes to a prewritten program are also not taxable |
| Digital music, video, books and other digital products delivered electronically | Not taxable | Only if no tangible storage media is transferred |
| Hosted software (SaaS) used remotely | Not a sale of tangible property | CDTFA has no SaaS-specific regulation; the basis is that no program copy or media is transferred. If anything is downloaded or shipped, apply the rows above. Get written advice for large contracts |
Mixed tangible and intangible sales. Three rules decide most cases:
| Situation | District tax that applies |
|---|---|
| Over-the-counter sale at a location in a district | The district sales tax where the sale takes place |
| Goods shipped (by the seller, its agent or a common carrier) out of the seller's district for use there | No district sales tax of the seller's district |
| Seller engaged in business in the delivery district | Collect that district's use tax at the delivery address rate |
| Seller not engaged in business there | Not required to collect; the customer owes it, and the seller may collect it as a courtesy |
| Retailer over $500,000 (with related persons) | Engaged in business in every district |
| Retailer under $500,000 | Engaged in business only where it has a presence, such as stored inventory or deliveries in its own vehicle |
These cases use invented businesses. Where a rate is "assumed", it stands for the result of a CDTFA address lookup; always look up the real address and date.
| Basis | Period | Due date |
|---|---|---|
| Quarterly | January-March / April-June / July-September / October-December | 30 April / 31 July / 31 October / 31 January |
| Quarterly prepay | Two monthly prepayments, then the quarterly return | Prepayments on the 24th (see below); return as for quarterly |
| Monthly | Each month | Last day of the following month |
| Yearly (sales tax accounts) | January-December | 31 January |
| Yearly (qualified purchasers and consumer use tax accounts) | January-December | 15 April |
| Fiscal yearly | July-June | 31 July |
| Charge | Amount | Condition |
|---|---|---|
| Late payment | 10% of the tax | Tax not paid by the due date |
| Late return | 10% of the tax, excluding prepayments | Return not filed by the due date |
| Cap | 10% of the tax per return | Late payment and late return penalties together cannot exceed 10% for any one return |
| Negligence | 10% of the deficiency determination | Any part of the deficiency due to negligence or intentional disregard (R&TC section 6484) |
| Fraud | 25% of the determination | Any part due to fraud or intent to evade (R&TC section 6485) |
| Tax collected but not remitted | 40% of the amount not remitted | Knowingly collected and not timely remitted; does not apply if the unremitted amount averages $1,500 or less per month or does not exceed 25% of the tax for the period, whichever is greater, or with reasonable cause (R&TC section 6597) |
| Resale certificate misuse | 10% of the tax or $500, whichever is greater | Per purchase (Regulation 1668) |
| Missed prepayment | 6% | See prepayments above |
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