A higher statewide sales tax rate went into effect in California on January 1.
Due to voter approval of Proposition 30, the statewide base sales and use tax rate will increase one quarter of one percent (0.25%) on January 1, 2013. The higher tax rate will apply for four years – January 1, 2013 through December 31, 2016.
This means business owners in California will now charge customers a tax rate that is now one quarter of one percent (0.25%) higher than it was in 2012. The California State Board of Equalization website also explains that some cities and counties have additional voter-approved district tax increases that will go into effect April 1, 2013.
Business owners in California should verify the sales tax rate they’ll be paying in 2013. To observe the new rates by county and city, click here.
Furthermore, the increased sales tax rate could mean higher bonding amounts for the state’s required sales tax bonds, which government agencies use to guarantee that business owners forward sales taxes to the state in full and on time. The amount of bonding coverage required is based on the amount of taxes a business is expected to charge during a certain period. The more sales tax a business is expected to bring in, the more bonding coverage is required. Because this sales tax rate increase means businesses will be responsible for forwarding additional tax funds, some businesses might have to purchase additional surety bond coverage, though this is not necessarily the case. As stated previously, bond amounts are determined by the amount of taxes a business brings in, so if the increase is not substantial enough, existing bond coverage could be sufficient.
If you need a sales tax surety bond in California or any other state in 2013, contact a surety expert by calling 1 (800) 308-4358 between 7 a.m. and 7 p.m. CST Monday through Friday. Or, submit an online contact request 24/7, and a surety expert will contact you as soon as possible.