The sales tax rate in San Francisco is 8.625%, and it applies to most retail purchases of physical goods anywhere in the city. That figure combines California’s 7.25% statewide base with 1.375% in voter-approved district taxes that fund local transit and other priorities. Whether you’re buying a sofa in the Mission or a laptop downtown, the rate on your receipt is the same.
How the 8.625% Rate Is Built
Every California city starts from the 7.25% statewide minimum. Of that, roughly 6% goes to the state and 1.25% stays local (0.25% for county transportation and 1% for city or county operations).1California Department of Tax and Fee Administration. Detailed Description of the Sales and Use Tax Rate
San Francisco layers on another 1.375% in district taxes approved by voters, which support the San Francisco County Transportation Authority, BART, and other local programs. Add it up and you land at 8.625%.1California Department of Tax and Fee Administration. Detailed Description of the Sales and Use Tax Rate
What Gets Taxed
The tax applies to retail sales of tangible personal property — physical items you can see, touch, or weigh.2California Legislative Information. California Code Revenue and Taxation Code 6016 Clothing, furniture, electronics, appliances, and building materials all count. It’s calculated on the retailer’s gross receipts from those sales.
Services generally don’t trigger sales tax. A haircut, a lawyer’s advice, or an accountant’s bill involves no physical property changing hands, so nothing gets added. Goods bought for resale aren’t taxed at the wholesale stage either; the tax hits only the final retail transaction.
Common Exemptions
California carves several categories out of the sales tax entirely:
- Grocery food for human consumption, including produce, meat, dairy, bread, and canned goods. Hot prepared meals, food sold for on-premises consumption, and certain vending machine items are not exempt.3California Legislative Information. California Code Revenue and Taxation Code 6359
- Prescription medicines dispensed by a registered pharmacist or furnished directly by physicians, dentists, and health facilities for patient treatment.4California Department of Tax and Fee Administration. Revenue and Taxation Code 6369 – Prescription Medicines
- Gas, electricity, and water delivered through mains, lines, or pipes.5California Legislative Information. California Code Revenue and Taxation Code 6353
Use Tax on Online and Out-of-State Purchases
Buy something from an out-of-state retailer or an online seller that doesn’t collect California tax, and you still owe the same 8.625% as use tax.6California Department of Tax and Fee Administration. Sales and Use Tax in California The rate and rules are identical; what changes is who pays. With sales tax, the retailer collects at checkout. With use tax, you report and pay the CDTFA directly.7California Department of Tax and Fee Administration. Know Your Sales and Use Tax Rate
Most large online retailers now collect California tax automatically, so use tax comes up less often than it used to. It still matters for purchases from smaller out-of-state sellers, private-party transactions across state lines, and items brought back from trips.
Private Sales and the Occasional-Sale Rule
Not every garage sale creates a tax obligation, but the threshold is lower than most people assume. If you make three or more sales of substantial value within any 12-month period, California treats you as a regular seller who needs a permit. Your first two sales are exempt; the third and anything after in that window are taxable.8California Department of Tax and Fee Administration. Regulation 1595 – Occasional Sales
Vehicles, boats, and aircraft never qualify for the occasional-sale exemption. If you sell a used car privately, the buyer owes use tax when they register it with the DMV.8California Department of Tax and Fee Administration. Regulation 1595 – Occasional Sales
If You Sell Goods: Getting a Seller’s Permit
Any business selling tangible goods in California needs a seller’s permit before its first taxable sale.9California Legislative Information. California Code Revenue and Taxation Code 6066 You apply through the CDTFA’s website and the permit itself is free.10California Department of Tax and Fee Administration. Obtaining a Seller’s Permit The CDTFA may require a security deposit based on your estimated sales volume. You’ll need a separate permit for each physical location.
Resale Certificates
Buying inventory to resell? Give your supplier a valid resale certificate (form CDTFA-230) and you won’t pay sales tax on that wholesale purchase. The certificate must include your seller’s permit number, a description of the goods, and your signed statement that the items are for resale in the regular course of business.11California Department of Tax and Fee Administration. California Resale Certificate CDTFA-230
Don’t use a resale certificate for personal purchases. The penalty is 10% of the tax that should have been paid or $500, whichever is higher, and deliberate misuse can bring misdemeanor charges.11California Department of Tax and Fee Administration. California Resale Certificate CDTFA-230 Sellers should keep certificates on file for at least four years.
Selling Through Online Marketplaces
Platforms like Amazon, eBay, and Etsy are classified as marketplace facilitators in California. Once the platform’s California sales exceed $500,000 in a calendar year, it must collect and remit sales tax on behalf of its third-party sellers. If you sell through one of these platforms, the platform handles that collection for you. Sales through your own standalone website remain your responsibility, and remote sellers themselves must register once their own California-bound sales cross the same $500,000 threshold.
Filing Returns and Making Payments
The CDTFA assigns your filing frequency — monthly, quarterly, or annually — based on sales volume when you register.12California Department of Tax and Fee Administration. Tax and Fee Rates and Filing Frequencies Most small businesses file quarterly. Each return asks for total gross sales, subtracts nontaxable amounts (resale transactions, exempt items, out-of-state shipments), and calculates the tax owed.
Filing and payment happen through the CDTFA’s online portal.13California Department of Tax and Fee Administration. Online Services ACH bank withdrawal is free; credit card payments carry a 2.3% processing fee charged by the card vendor, not the CDTFA.14California Department of Tax and Fee Administration. Online Services – Make a Payment Keep the confirmation number the system generates.
Recordkeeping
Keep all sales and use tax records for at least four years.15California Department of Tax and Fee Administration. Regulation 1698 – Records That means sales receipts, purchase invoices, resale certificates you’ve received, and exemption documentation. When records are missing during an audit, the CDTFA can estimate what you owe, and the estimate rarely favors the taxpayer.
Penalties, Interest, and Audit Lookback
Miss a deadline or underpay and you’ll face a 10% penalty on the unpaid amount. Filing late adds its own 10% penalty, though the combined penalty for any single return caps at 10% of the tax owed.16California Department of Tax and Fee Administration. Having Trouble Paying? Interest accrues from the day after your payment was due. For 2026, the CDTFA charges 10% annually on delinquent balances.17California Department of Tax and Fee Administration. Interest Rates
If a penalty was imposed because of circumstances beyond your control, you can request relief from the CDTFA. Interest cannot be waived even if the penalty itself is forgiven.18California Department of Tax and Fee Administration. Online Services – Request Relief
The CDTFA can audit your returns going back three years from the filing date. If you never filed, the lookback stretches to eight years. For fraud, there’s no time limit at all.19California Department of Tax and Fee Administration. Revenue and Taxation Code 6487 – Statute of Limitations
Buying an Existing Business
If you’re purchasing a San Francisco business, the seller’s unpaid sales tax can become yours. California law requires buyers to withhold enough of the purchase price to cover any outstanding tax until the seller produces a CDTFA clearance showing the balance is paid or that nothing is owed.20California Department of Tax and Fee Administration. Revenue and Taxation Code 6811 – Withholding by Purchaser Skip that step and the CDTFA can collect the former owner’s balance from you personally. A purchase agreement between you and the seller doesn’t bind the state.
Claiming Sales Tax on Your Federal Return
If you itemize federal deductions, you can deduct either California income tax or state and local sales tax, not both. For 2025, the state and local tax deduction was capped at $40,000 ($20,000 if married filing separately), with the cap indexed for inflation in later years.21Internal Revenue Service. How to Update Withholding to Account for Tax Law Changes
Because California has a state income tax, most San Francisco residents come out ahead choosing the income tax option. If you made unusually large purchases during the year — a vehicle, major renovations, expensive business equipment — run the numbers both ways. The IRS publishes optional sales tax tables you can use instead of tracking every receipt, though actual receipts will produce a more accurate figure when your spending was high.