July 1, 2011 California Tax Decrease

That’s right, effective July 1, 2011 Californians will experience a decrease in California city and county tax, as well as California vehicle license fees. Here are all the details…

As a follow up to the CRA alert on June 13 with regard to the status of the state sales tax rate and vehicle license fee, both will be reduced Friday. The Legislature and Governor were not successful in their attempt to extend the higher tax rates for additional years.

As a result, effective July 1, the 1 percent sales and use tax rate increase that was approved with the state budget and effective April 1, 2009 will expire, lowering the statewide base tax rate from 8.25 percent to 7.25 percent. In areas where there are voter-approved district taxes, the total tax rate related to sales and purchases will be the statewide base tax rate of 7.25 percent plus the applicable district tax.

Also, the current Vehicle License Fee (VLF) will drop by .5 percent from the current 1.15 percent rate.

For more information on the California city and county sales and use tax rates visit the BOE’s website at http://www.boe.ca.gov/news/2011/77-11-H.pdf.

If you have any questions, comments or concerns, you may contact the Total Protection Team at 951-600-5751 or Email us at insure@siaonline.com.

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