On Jan. 1, the statewide sales and use tax rate decreased one quarter of one percent (0.25%) from 7.5 percent to 7.25 percent. The decrease in the statewide rate is effective for all cities and counties in California; however, in many jurisdictions in California the actual sales and use tax rate may still be higher than the statewide rate due to the addition of district taxes.
Proposition 30, The Schools and Local Public Safety Protection Act of 2012 that was approved by California voters in November 2012 to temporarily increase the sales and use tax by 0.25 percent expired Dec. 31, 2016.
The web page at maps.gis.ca.gov/boe/TaxRates allows visitors to find the correct rate in a city or county. Additionally, a listing of sales and use tax rates for each city and county is available on the California City & County Sales & Use Tax Rates webpage at boe.ca.gov/app/rates.aspx.
A retailer who continues to charge and collect the higher statewide sales and use tax rate after Jan. 1 must either refund the excess tax collected to their customer or pay the excess tax to the Board of Equalization (BOE).
If the excess tax collected has been paid to the BOE, the retailer may request a refund on behalf of their customer by completing form BOE-101, Claim for Refund or Credit.
For merchandise delivered after Jan. 1, the applicable sales and use tax rate is the rate that is in effect at the time the sale occurs.
Generally, the sale occurs when the merchandise is delivered to the customer, unless the sales contract specifically states that title to the merchandise passes to the customer prior to delivery.
With returned merchandise, the customer should be refunded the amount of tax at the rate that was charged and collected from the customer at the time of the original sale.
For information on how this affects fixed-price contracts, partial tax exemptions, fuel sales and filing split returns, visit boe.ca.gov/sutax/prop30.htm or call the BOE’s customer-service center at 1-800-400-7115 weekdays from 8am to 5pm.
Source: BOE
