Sales Tax In California
Rate of Sales Tax in California Increased From January 1, 2013
With effect from January 1, 2013, the rate of basic Sales and Use tax in California stands revised as per the announcement of the California State Board of Equalization (BOE.) There is an increase of 0.25 percent, meaning the latest rate shall be 7.25+.25=7.5 percent. Therefore, suppliers of good in California will have to start charging the revised rate of tax with effect from 1st January, 2013.
At what the tax is chargeable?
The purchaser is charged tax at the time of buying. Buying is said to take place when you take possession of any article or title.
What action should I take to revise the rate of tax in my zone?
The new revised rate of tax is applicable for all zip zones. You have nothing to do for updating your calculation of tax rate. With effect from 1st January, 2013, the relevant information contained in DaFIS will be updated automatically.
Other systems using information on rate of tax as contained in DaFIS will also start computing the revised rate of tax from 1st January, 2013 onwards. These include the Purchasing Card program (meant for charging tax on items bought from outside the state) and UCD Buy.
How would the changeover affect working of DaFIS?
Invoices from vendors and documents of purchase made in DaFIS prior to 1st January, 2013 would charge tax at the old rate.
Invoices from vendors and documents of purchase created in DaFIS on or beyond 1st January, 2013 would charge new rate of tax.
• Documents of purchases made prior to Jan 1, 2013 will compute old rate of tax but the bills from vendors prepared against such purchase documents on or later than 1st January, 2013 will compute the latest rate of tax.
As a general rule, you won’t have to modify the amount of tax computed on DaFIS document except in the following case:
In case you bought an item earlier than 1st January, 2013, meaning the purchase took place prior to 1st January, 2013, but you are giving out the VI later than 1st January, 2013, it will become necessary for you to manually alter the sum of tax on your VI to mirror the preceding rate of tax.
You will be required to incorporate a note in the VI to indicate that you made adjustment of the amount of tax because the sale took place earlier than 1st January, 2013.
What happens if the supplier seems to charge the wrong rate?
Before approaching the supplier, you should recheck the dates mentioned in the bill. It may so happen that you receive the bill later than 1st January, 2013 but in fact the sale could have taken place prior to 1st January, 2013. In such cases old rate of tax should have been charged. On realizing that the rate of tax charged by the supplier in their bill is wrong, you need to approach them to get a revised bill.
What will be the effective rate of tax with effect from 1st January, 2013 as applicable in Davis Campus and Davis city?
• The applicable rate of tax for Davis Campus shall be 7.5 percent.
• The rate of tax for Davis City will be eight percent.