DEFINITION

All dealers are required to obtain a permit from the State Board of Equalization to collect and remit sales & use taxes.

All dealers shall, in every transaction of a used vehicle, pay to the state the applicable sales and use taxes.

We recommend a separate check to the board for each retail transaction. The memo box of the check should include:

  • ROS number
  • Year make and model of the vehicle
  • Taxable sales price (with docs fee & smog inspection included) Buyers County of residence
  • Tax rate for that county
  • These checks should be set aside for monthly or quarterly reports. The basic sales tax rate is 7.25-10.25%

There are some counties with increased rates.

Check with state board local office for applicable rate at your location.

Dealers are not required to collect additional tax if the buyer lives outside the higher tax district as per B of E regulation 1823.5(d).