Calif. sales tax increase ends, bumps down to 7.25 pct


Sacramento Democrats wanted to extend these taxes, but Republicans were fighting to end it on schedule. The Republicans won the fight, and shoppers are glad to hear it.

Taxes are a fact of life most manage to live with, but lower taxes make living a bit easier and that's why shoppers are smiling to know the state sales tax is going down.

"Anything that goes down to help the pocketbook is going to be a plus," said shopper Donna Duncan.

The rate is dropping from 8 .25 percent to 7.25 percent. The 1 percent drop is not a lot, but every little bit does help those buying and those selling, too.

"It can help business. It can help everybody. You know, we're going through a recession, and I think slowly, the business is coming back," said merchant Michel Delcros. "I work for a restaurant here in town, and I'm sure it will help."

It's at car dealerships that you will really notice the change. When you're talking about a car that costs $30,000, 1 percent adds up to real money.

"Before, you're at what, almost 10 percent and the license fees were substantial. So now, the license fees have almost been cut in half and we've dropped it a full point. So, that's a substantial savings. That's good for the consumer," said car dealer Don Fleming.

Some say the lower rate might even make them spend a little more.

"I would hope I would be able to shop a little more. I don't know how much more, but a little bit more," said Duncan.

Of course lower taxes for shoppers mean lower revenues for the state of California and less services. Still, it's hard for buyers not to feel a little better about paying a little less.

Consumers should keep in mind that while the state tax will be at 7.25 percent, cities and counties can add their own sales taxes on top of that.

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