California Just Published Its October 1 Sales Tax Rate Changes. Here's Every City and County Affected
California updates its local sales tax rates four times a year — January 1, April 1, July 1, and October 1. Each cycle reflects the results of the most recent ballot elections, where California voters approve or extend local district taxes that layer on top of the state's 7.25% base rate.
The California Department of Tax and Fee Administration just published Special Notice L-1037 — the official notification of new sales and use tax rates effective October 1, 2026. The new rates are already available to view and download as a spreadsheet on the CDTFA's website, with the address-level lookup tool updating on October 1.
For any business selling into California — from a physical storefront, an ecommerce platform, or a marketplace — this is the compliance deadline to prepare for right now. Here's what changed, why California's rate structure is so complex, and exactly what you need to do before October 1.
Why California Has So Many Rate Changes Every Quarter
California's combined sales tax rate is one of the most complex in the country — not because the state rate changes often, but because the local layer never stops moving.
As the CDTFA's California City and County Sales and Use Tax Rate information confirms, California has more than 540 local tax jurisdictions — 483 incorporated cities plus 57 county unincorporated areas — each with its own combination of district taxes approved by voters at various elections over the past several decades. Combined rates statewide range from 7.25% in jurisdictions with only the base rate to 11.25% in Lancaster and Palmdale in Los Angeles County.
Those 540-plus jurisdictions don't all move at once. But every California ballot election — held in March, June, and November each year — produces a fresh set of voter-approved district tax changes that take effect on the next quarterly cycle. The November 2025 ballot produced changes effective April 1, 2026. The March 2026 ballot produced changes effective July 1, 2026. And the June 2026 ballot produced the changes now taking effect October 1, 2026 under CDTFA L-1037.
Over the past year, there have been 39 local sales tax rate changes in California, according to SalesTaxHandbook's California rate change tracker. October 1 adds the latest wave to that running total.
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What's Changing October 1 — The Specific Jurisdictions
According to CDTFA L-1037, the following California cities are increasing their sales tax rates effective October 1, 2026, reflecting voter-approved district tax measures from the June 2026 election.
Campbell in Santa Clara County is increasing its city tax rate. Dunsmuir in Siskiyou County is increasing its rate. Los Gatos in Santa Clara County is increasing its rate. McFarland in Kern County is increasing its rate. Milpitas in Santa Clara County is increasing its rate. Santa Fe Springs in Los Angeles County is increasing its rate. San Jose — California's third-largest city and the heart of Silicon Valley — is increasing its rate effective October 1.
Santa Clara County itself is increasing its county tax rate for unincorporated areas and for incorporated cities within the county that do not impose their own district tax — meaning some Santa Clara County addresses that weren't previously affected by a county-level district tax increase will now carry a higher combined rate.
As USGeocoder's 2026 California sales tax rate changes blog confirmed in its April 2026 update, Culver City in Los Angeles County also increased its city tax rate by 0.25% — and additional changes in the October cycle are continuing that trend of LA County jurisdictions ratcheting rates upward.
The full list of affected jurisdictions is published in the CDTFA's L-1037 Special Notice PDF and the downloadable rate spreadsheet available at cdtfa.ca.gov. These are the authoritative sources for the complete and final October 1 rate changes.
San Jose at the Center of the October Changes
San Jose deserves specific attention because of its size and economic significance.
San Jose is California's third-largest city — home to roughly 1 million residents and the commercial hub of Silicon Valley. Any rate change in San Jose affects an enormous volume of transactions — both in-store purchases by Bay Area residents and ecommerce deliveries to San Jose addresses from sellers across the country.
As TaxCloud's California sales tax guide explains, a sale shipped to Los Angeles requires 10.25% while a sale shipped to San Diego requires 7.75% — illustrating how dramatically rates vary across California cities even before October's changes. San Jose's rate increase adds another data point to that variation — and makes address-level accuracy more important than ever for ecommerce sellers with significant Bay Area customer volume.
For sellers shipping to San Jose, Milpitas, Los Gatos, Campbell, and Santa Clara County unincorporated areas — all of which are changing October 1 — the rate you're collecting today is not the rate you should be collecting from October 1 onward.
How California's District Tax System Works
Understanding why California has so many quarterly rate changes requires understanding the layered structure that produces them.
California's 7.25% statewide base rate includes a 6% state tax and 1.25% mandatory local rate that funds county and city transportation. That 7.25% is the floor — the minimum any California transaction can be taxed at.
On top of that base, California places no statutory ceiling on how many voter-approved district taxes can stack. Cities, counties, transportation districts, public safety districts, general purpose districts, and other special purpose districts can each place their own measures on the ballot. When voters approve them, the new layer adds to whatever the previous combined rate was.
As the Catalyst CPA's 2026 California rate changes guide noted, the April 1, 2026 update was not the last California sales tax rate change of the year — the CDTFA issues additional Special Notices for the July 1 and October 1 rate cycles. That pattern means any business that audits its California rates once a year is almost certainly out of date at some point during the year.
California uses destination-based sourcing for district taxes — meaning the rate that applies to a sale depends on where the buyer takes possession of the goods or where delivery occurs, not where the seller is located. A seller based in Texas shipping to a San Jose address applies San Jose's rate — including any district taxes specific to San Jose. A seller based in San Jose shipping to San Diego applies San Diego's rate. Where your business is located is irrelevant to which rate applies on any given transaction.
The Los Angeles County Picture
Los Angeles County deserves its own section because of both its size and its ongoing rate trajectory.
LA County has the largest population of any county in the United States — roughly 10 million residents spread across 88 incorporated cities plus unincorporated areas, each with its own rate configuration. Combined rates in LA County cities range from 9.5% in some unincorporated areas to 11.25% in Lancaster and Palmdale.
Measure ER — the half-cent healthcare sales tax that barely passed in June 2026 at 50.35% and was officially certified in early July — will add another 0.5% to most LA County combined rates when it takes effect in October 2026. We covered Measure ER's passage and its compliance implications in detail in our LA County Measure ER article.
The result: businesses selling into LA County are dealing with two simultaneous October 1 compliance events — the CDTFA's standard quarterly rate cycle under L-1037, and the Measure ER rate addition. Sellers who update their systems for one and miss the other will be collecting the wrong amount.
What You Need to Do Before October 1
Here's the compliance action list.
Verify your California address coverage. If you sell into California and use address-level tax calculation, confirm your software vendor has incorporated the October 1, 2026 rate changes from CDTFA L-1037. Most major tax engines — Avalara, TaxJar, Vertex, TaxCloud — update California rates automatically on the CDTFA's quarterly schedule. But "updates automatically" isn't the same as "has already been verified for accuracy on October 1." Ask your vendor specifically when the October 1 California rates will be active in your system.
Check your San Jose, Milpitas, Los Gatos, Campbell, and Santa Clara County rates specifically. These are the jurisdictions most likely to have active ecommerce customer bases that are also seeing rate changes on October 1. If you have significant customer volume in Silicon Valley, these are your highest-priority verification targets.
Handle LA County separately. If you sell into LA County, the Measure ER implementation adds 0.5% on top of whatever the standard quarterly changes bring. Verify that your system is handling both the standard CDTFA quarterly update and the Measure ER addition correctly and simultaneously.
Use the CDTFA's address lookup tool starting October 1. The CDTFA's Find a Sales and Use Tax Rate by Address tool updates to reflect new rates on October 1 — making it the authoritative verification source for any specific California address from that date forward. If you're uncertain about any California address, run it through the CDTFA tool after October 1 to confirm the correct combined rate.
Update your rate tables if you manage California rates manually. If you're not using automated tax software for California and manage your rate tables in a spreadsheet or accounting system, download the CDTFA's updated rate spreadsheet available on their website starting September 1, 2026 — it's already live — and update your rate configuration before October 1.
California's Filing Structure — One Return for All of It
Here's one of the few simplifying features of California's otherwise complex rate landscape.
Despite 540-plus jurisdictions with individual rates, California centralizes all sales tax filings with the CDTFA — so you file one return regardless of how many California jurisdictions you sold into. You don't file separate returns for San Jose, Los Angeles, and San Diego. The CDTFA allocates the revenue to the appropriate jurisdictions based on the addresses you report.
That centralized filing structure makes California operationally simpler than states like Colorado — where home rule cities require separate filings — or Illinois — where business district taxes require detailed address-level reporting on the state return. But it doesn't reduce the accuracy requirement on rate collection. Collecting the wrong rate for a San Jose address still creates an under-collection liability, even if the return mechanics are simpler than other states.
California's economic nexus threshold is $500,000 in annual California sales — significantly higher than most states' $100,000 threshold. Sellers below that threshold don't have a California collection obligation. But sellers above it are required to collect the correct rate for every California delivery address — including every October 1 change — from the first qualifying transaction.
Not sure whether your California rates reflect the October 1 changes from CDTFA L-1037 — or need help verifying your LA County rate configuration for both the standard quarterly update and Measure ER? Book a free consultation with our team at sales.tax. We'll verify your California rate setup and make sure every affected jurisdiction is calculating correctly before October 1.
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