California Sales Tax

[MarvBear]

Information from NADA Title & Registration Textbook 2004

 

California Sales and Use Tax Applicable to Registration

 

Sales tax is due upon the sale of a vehicle by a dealer in California. When an amount is not paid as California “sales tax” to a vehicle dealer, such as when the vehicle is purchased from a private party or from out of state, use tax is payable to the DMV, on behalf of the Board of Equalization, at the time of registration of the vehicle if it was purchased for use in California. There is no exemption for military personnel. It is presumed that a vehicle is purchased for use in California and use tax applies if it is brought into the state within 90 days of purchase, excluding the time of shipment or storage for shipment, unless it is used outside California 50 percent or more of the time during the six months immediately following its first entry into California. The use of a vehicle outside the state for more than 90 days prior to its first entry into California, excluding the time of storage or shipment for storage, is accepted as proof the vehicle was not purchased for use in California, and use tax does not apply. Use tax will also not apply if one-half or more of the miles traveled by the vehicle during the 6-month period immediately following its entry into this state are commercial miles traveled in interstate or foreign commerce. The term “commercial” applies to business uses and excludes personal use. The tax rate for both sales tax and use tax is 7-1/4% to 8-1/2% depending on the county where the vehicle will be registered. The tax is due on the full selling price, including the value of any trade-in. With respect to a vehicle the owner purchased outside California, a credit will be given, not to exceed the California use tax due, for sales or use tax paid by the owner to another state when purchasing the vehicle.