California’s sales tax applies to the sale of merchandise, including vehicles, in California. Use tax applies to the use, storage, or other consumption of those same kinds of items in California. Use tax started to protect California merchants from unfair out-of-state competition but it now also applies to certain purchases made within the state.

Use tax applies when you buy something that will be used, consumed, given away, or stored in California. It generally applies to:

 California consumer or retailer purchases from out-of-state vendors who do not collect California tax on their sales

 Retailer use of items purchased using a resale certificate

 Purchases of vehicles, vessels, mobile homes, and aircraft from sellers who do not hold seller’s permits

The buyer of the item that will be used, consumed, or stored in California owes the use tax. In some cases, sellers must collect the use tax from their customers and pay it to the State Board of Equalization.

Sales tax and use tax rates are generally the same. However, when the tax is due, the full tax rate for the location where the property will be used, stored or consumed applies, regardless of where the sale takes place.