As the new sales tax rates kicked in across California Tuesday, big-ticket items like vehicles are now costing people more, especially in Los Angeles County.
While the county grapples with the sales tax rate of 9.75%, one of the highest in the country, many cities within the county are seeing an even higher rate as each jurisdiction is allowed to impose additional district taxes.
Shoppers may be able to save some money if they decide to buy other big-ticket items like furniture and appliances in a different county with a lower sales tax rate, the tax for cars is calculated based on where the car is registered.
That means, even if a shopper based in Lancaster buys a vehicle from the city of Ventura (7.75% sales tax,) the person will still have to pay the full price with 11.25% levied in Lancaster and Palmdale.
Car dealerships like Valley Auto Center in Lancaster expect consumers to feel the difference right away.
“A percentage up on something you’re spending thousands of dollars on, you’re definitely going to feel it right at the sticker,” Nicholas Douglas, general manager at Valley Auto Center, said. “If you’re paying a finance charge, you’re going to feel that a few times.”
A shopper looking to buy a used car priced at $24,995, the total amount the person will pay in sales tax will be over $2,800, nearly $300 more than what the consumer would have paid before Tuesday.
“$2,575 would have been the sales tax yesterday. One day later, we’re up to $2,827 so as you can see it’s a substantial increase,” Douglas said.
When the median household income in Lancaster is $76,083, a dollar may not go as far, Douglas feared.
“Here in the Antelope Valley, we have such a tight median household income that any additional taxes, I know that our neighbors are going to feel it for sure,” he said.
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