Publication 105, District Taxes and Sales Delivered in California
September 2023
District Taxes
The sales and use tax rate is not the same in all California locations. While the standard statewide rate is currently 7.25 percent, the total sales and use tax rate is higher in areas where there are voter-approved special transactions (sales) and use taxes. In those areas (districts), the total tax rate includes the standard statewide tax rate plus the district tax rate (which varies from district to district). If you are engaged in business in a special taxing jurisdiction, you must report district taxes on Schedule A of your sales and use tax return.
For general information on applying sales tax to delivery charges, please see publication 100, Shipping and Delivery Charges.
Please note: District tax generally applies to over-the-counter retail sales within a district unless the retailer is a registered seller of vehicles, vessels, or aircraft (see below).
Determining where district taxes are in effect
To determine the correct tax rate at a location, please select, California City & County Sales & Use Tax Rates. This webpage includes information on special tax districts and provides the tax rates for all California cities and counties. If the rate listed for a city or county is higher than 7.25 percent, that city or county is in a special tax district. While most special tax districts cover entire counties, some are limited to specific cities. There may also be more than one district tax in effect in a specific location.
Find a Sales and Use Tax Rate by Address
As an additional resource, we offer an online mapping tool to determine the current sales and use tax rate for a specific address. Be sure the address information you input is the address you intended. The tax rate given will reflect the current rate of tax for the address that you enter. To find a tax rate, please select Find a Sales and Use Tax Rate by Address.
Some cities within a special tax district have developed a database of addresses to help identify specific addresses located within their taxing boundaries. Please contact the cities directly if you have questions about the addresses. Once you have established the locations, you can find the correct tax rates by selecting, Find a Sales and Use Tax Rate by Address.
Please note: This publication summarizes the law and applicable regulations in effect when the publication was written as noted above. However, changes in the law or in regulations may have occurred since that time. If there is a conflict between the text in this publication and the law, decisions will be based on the law and not on this publication.
Basic Rules
Follow the basic rules below in applying district tax to sales of merchandise delivered in California unless you are a registered dealer of vehicles, undocumented vessels, or aircraft.
| Shipping or delivery destination | Applicable tax rate |
|---|---|
| Location outside of all special tax districts. | Generally, the standard statewide tax rate of 7.25 percent. |
| Location inside a special tax district. | Total rate for the district (statewide rate + district rate). However, if you are not engaged in business in the district, you are not required to collect district tax and you may use the statewide rate (7.25 percent). See Delivery to a location inside a special tax district and "engaged in business" for more information. |
Special Situations
Registered sellers of vehicles, undocumented vessels, and aircraft
If you are a registered seller of vehicles, undocumented vessels, or aircraft, you must generally apply tax to your sale or lease at the tax rate in effect at the California location where your customer will register or license their purchase.
This is true regardless of where the item is sold or delivered. If a district tax is in effect at the registration or licensing location, the total tax rate for the district (statewide rate + district rate) will apply to your sale. For more information, please see publication 34, Motor Vehicle Dealers.
Delivery to a location inside a special tax district and "engaged in business"
The total tax rate in effect in a special tax district (statewide rate + district rate) generally applies to sales delivered or shipped into the district. However, if you are not engaged in business in the district, you are not required to collect the district use tax. Instead, you may calculate the tax due on your sale at the statewide rate of 7.25 percent (see "Courtesy collection of district use tax," below). You are considered to be engaged in business in a special tax district and must report and pay district use tax if any of the following apply:
- Maintain, occupy, or use, directly or indirectly, or through a subsidiary or agent, a permanent or temporary office, place of distribution, sales or sample room, warehouse or storage place, or other physical place of business in the district.
- Have a representative, agent, or independent contractor operating in the district on your behalf or under your authority, or under the authority of your subsidiary, for the purpose of making sales, taking orders, assembling or installing merchandise, training customers, making deliveries, or otherwise establishing or maintaining a market for your products.
- Receive rental payments from the leases of tangible personal property that is located in the district, such as leases of machinery, equipment, and furniture.
- Own or lease real property or tangible personal property in the district, such as machinery, equipment, furniture or a computer server.
- Sell or lease vehicles or undocumented vessels which will be registered in a district.
- Have total combined sales of tangible personal property in California or for delivery in California by you and all persons related to you exceeding $500,000 in the preceding or current calendar year (see "Additional district use tax collection requirement" section below).
As noted above, you may be engaged in business in a special tax district even if you do not have a permanent location there. For example, if the sales representative for your Calaveras County business travels to San Joaquin County to take an order, you are considered to be engaged in business in the San Joaquin Transportation Authority special tax district. Tax would apply to your sale at the full rate in effect for San Joaquin County. You would report the San Joaquin Transportation Authority district tax on Schedule A of your sales and use tax return.
Additional district use tax collection requirement
Beginning April 25, 2019, a retailer is engaged in business in a district if, during the preceding or current calendar year, the total combined sales of tangible personal property in California or for delivery in California by the retailer and all persons related to the retailer exceed $500,000. A person is related to a retailer if they have a relationship with the retailer described in Internal Revenue Code section 267(b) and the related regulations.
Accordingly, beginning April 25, 2019, any retailer required to be registered with the CDTFA, whether located inside or outside of California that meets the $500,000 threshold is engaged in business in every district in California whether or not they have a physical presence in those districts. As such, these retailers are required to collect the district use tax on taxable sales made for delivery in those districts that impose a district tax. Retailers that do not meet the $500,000 threshold are still engaged in business in any district(s) in which they have a physical presence. For more information, see publication 44, District Taxes (Sales and Use Taxes), and our online guide Use Tax Collection Requirements Based on Sales into California Due to the Wayfair Decision.
Delivery outside special tax districts
Some sales of merchandise and certain types of vehicles, aircraft, and undocumented vessels may qualify for an exemption from a district's sales or use tax. Please see publication 44, District Taxes, (Sales and Use Taxes) for more information.
Courtesy collection of district use tax
Generally, if you are not engaged in business in a special tax district and you ship by common carrier into the district, your customer is liable for the district use tax. As a courtesy to your customer, you may choose to collect the district use tax from them. If you do, it should be shown on the customer's invoice and you must report it on Schedule A of your return and pay it to us.
Sales to aircraft common carriers; fixed-price contracts
The information in this publication may not apply to your sales to aircraft common carriers or sales involving fixed-price contracts. For help, please visit the CDTFA's website at www.cdtfa.ca.gov or contact the Customer Service Center by calling 1-800-400-7115 (CRS:711).