LOCAL ECONOMY | LOS ANGELES
Measure ER takes the base rate from 9.75% to 10.25% on Oct. 1. Lancaster and Palmdale reach 11.75%, four points above Irvine and Fullerton in Orange County
Los Angeles County's base sales tax rate rises from 9.75% to 10.25% on Oct. 1. That is when Measure ER, approved by voters in the June 2 primary, takes effect. It is the first time the county's base rate has gone above 10%.
The county says it needs the money to cover federal health-care cuts. H.R. 1, the budget reconciliation law known as the One Big Beautiful Bill Act, reduces funding for Medi-Cal, California's Medicaid program. County health departments expect to lose about $2.4 billion over three years, LAist reported. The half-cent increase is projected to raise about $1 billion a year for public hospitals, clinics and public health programs. It expires on Oct. 1, 2031.
Cities that levy their own add-on taxes move into the 11% range. Lancaster and Palmdale go from 11.25% to 11.75%. Burbank, San Gabriel and West Hollywood go from 10.5% to 11%. Across the county line to the south, Irvine and Fullerton in Orange County stay at 7.75%. That is 2.5 points below the city of Los Angeles and 4 points below Lancaster and Palmdale.
Yoon Joo-ho (윤주호), a certified public accountant at YOON & CO., CPA, whose office is on Wilshire Boulevard in Koreatown, wrote in the Korea Daily (미주중앙일보) on Sept. 9 that the gap is likely to send more shoppers to lower-tax areas. Whatever the merits of funding public health care, he asked why the county chose a sales tax. It applies regardless of income, he noted, so it weighs more heavily on lower- and middle-income households, which spend a larger share of what they earn.
$125 on a $5,000 appliance, $200 for a Lancaster resident
Consumers facing a tax increase have two options, Yoon wrote: put off or cut back on purchases, or buy where the rate is lower. Half a point on its own may not change much, he said. Combined with the gaps that already exist, though, it will lead shoppers to compare the final price, sticker plus tax.
The difference shows up on refrigerators, washers, televisions and furniture that cost thousands of dollars. A $5,000 purchase carries $512.50 in tax in Los Angeles and $387.50 in Irvine or Fullerton, a $125 difference. A Lancaster or Palmdale resident pays $587.50, $200 more than in Orange County.
Cars, motorcycles and boats are taxed by registration address
Vehicles are the exception, Yoon wrote. Many buyers assume they can save by purchasing in a lower-tax area, but under California law, sales tax on vehicles, motorcycles and boats registered with the DMV is based on the buyer's residence and registration address, not where the sale happens. A car bought from an Orange County dealer and registered at an L.A. County address is taxed at the L.A. County rate. Shopping across the county line saves money only on goods that do not require registration, such as appliances, furniture and jewelry.
Koreatown at 10.25%, Fullerton and Irvine at 7.75%
Koreatown lies within the city of Los Angeles and will be taxed at 10.25% starting Oct. 1. Fullerton and Irvine, which have their own large Korean-American shopping districts, stay at 7.75%. The two areas are within about an hour's drive of each other, close enough for the difference to matter on big-ticket items.
Higher sales taxes shrink local spending or spread it across jurisdictions, Yoon wrote, and price-sensitive retailers and restaurants are the most exposed. Lost customers hurt small-business owners more than large companies, he said.
More increases are on the table. the Korea Daily reported on May 18 that 12 proposed tax and fee increases, covering sales, hotel and parking taxes among others, were on California ballots across the June primary and the November midterm.
11.75% in Lancaster and Palmdale; county reaches the state ceiling
On a $100 purchase, the increase adds 50 cents. Unprepared food and prescription drugs remain exempt. Restaurant meals and other prepared food are taxed.
LAist noted that Measure ER brings the countywide rate to 10.25%, the ceiling under state law. Cities such as Lancaster and Palmdale that go higher need special authorization from the Legislature.
A 24,000-vote margin
Measure ER passed 50.9% to 49%, a margin of about 24,000 ballots, according to LA Magazine's June 11 count. It was written as a general tax, with no legally binding spending restrictions, so it needed only a simple majority. A special tax would have required two-thirds. A poll before the vote had opposition ahead, 47% to 45%, LAist reported.
The measure's official name is the Essential Services Restoration Act. Supervisors Holly Mitchell and Hilda Solis introduced it in January. Mitchell told LA Magazine the county had turned to a sales tax as a "last resort" after hiring freezes, limits on overtime and drawing down emergency reserves.
Supervisor Kathryn Barger cast the only vote against putting it on the ballot. "Moving forward, my responsibility is to ensure the revenues generated are managed with accountability and measurable results," she told NBC Los Angeles on June 10.
The California Contract Cities Association and the Los Angeles County Taxpayers Association also opposed the measure, according to LAist, as did several cities in the county, including Norwalk and Glendale.
1.1 million Medi-Cal enrollees at risk; 45% of revenue to nonprofit clinics
About 3.8 million L.A. County residents are enrolled in Medi-Cal. LAist reported that about 1.1 million of them could lose coverage by 2028 under the stricter eligibility rules in H.R. 1. It also reported that the county's health departments face losses of roughly $800 million a year. The Department of Health Services runs four public hospitals and about two dozen clinics on an operating budget of more than $6 billion. It projects its annual revenue will fall by $700 million by fiscal 2028-29.
Under the county's spending plan, 45% of the money would go to nonprofit clinics that treat uninsured low-income patients. Another 22% would go to county hospitals and clinics, and 10% to the Department of Public Health for disease prevention and inspections. The plan is not binding, but a nine-member advisory committee will oversee spending and the program will be audited every year. St. John's Community Health contributed more than $4 million to the yes campaign by early April, and SEIU Local 721 gave $200,000, LAist reported.
Merchants must update point-of-sale rates before Oct. 1
Retailers need to change the rates in their point-of-sale systems before Oct. 1. The Tax Shack, a tax preparation firm, advises checking each location's rate with the California Department of Tax and Fee Administration's address lookup and applying the destination rate on goods shipped to other cities. Remittances for the October-December quarter will be larger, which affects cash flow.
Outlook: a 2031 sunset, with renewal tied to audits and the size of federal cuts
Measure ER expires on Oct. 1, 2031. Its projected $1 billion a year exceeds the roughly $800 million in annual losses LAist cited for county health departments. Medi-Cal disenrollment is expected to continue through 2028. Any debate about extending the tax will turn on the advisory committee's annual audits and on how deep the federal cuts turn out to be.
"Taxpayers deserve to know how these funds are being spent, whether promised outcomes are being achieved."
Kathryn Barger, L.A. County Supervisor · NBC Los Angeles, June 10
The effect on spending will vary by what people buy. Groceries and prescriptions are exempt, which limits the hit to everyday costs. For appliance and furniture purchases in the thousands of dollars, the 2.5-to-4-point gap between Los Angeles and Orange County will enter the math. Cars are unaffected because they are taxed by registration address. Taxable sales figures for October through December, the first full quarter under the new rate, will be the first data to show whether the drop in small-business sales Yoon warned about actually happens.
Sources
Yoon Joo-ho, "[Tax Basics] L.A. County Sales Tax Enters the 10% Era" (미주중앙일보), Korea Daily, Sept. 9, 2026 https://www.koreadaily.com/article/20260909184632593
LA Magazine, "Measure ER Passes, Raising LA County Sales Tax to 10.25%", June 11, 2026 https://lamag.com/health/measure-er-passes-raising-la-county-sales-tax-for-public-healthcare-initiatives/
NBC Los Angeles, "Measure ER passes, set to increase LA County sales tax for public health care", June 10, 2026 https://www.nbclosangeles.com/news/local/la-county-measure-er-pass-sales-tax/3902591/
LAist (Aaron Schrank), "Measure ER: What you need to know about the proposed sales tax hike in LA County" https://laist.com/news/politics/voter-guides/2026-election-california-primary-la-county-sales-tax-measure-er
Radio Seoul (라디오서울), "L.A. County sales tax rises to as high as 11%" https://www.radioseoul1650.com/archives/156535
The Tax Shack, "LA Sales Tax Is Going Up October 1st, 2026" https://www.mytaxshack.com/blog/la-sales-tax-increase-october-2026-measure-er
Korea Daily (미주중앙일보), California tax-increase measures roundup, May 18, 2026 https://www.koreadaily.com/article/20260518205315480
City of West Hollywood, "LA County Sales Tax Rate Change Goes into Effect on Thursday, October 1, 2026" https://www.weho.org/Home/Components/News/News/12298/
CDTFA, L-1037 "New Sales and Use Tax Rates Effective October 1, 2026" https://cdtfa.ca.gov/formspubs/L1037.pdf
Quotation policy: text in quotation marks is reported speech; unquoted attributions summarize the cited column or report. Yoon Joo-ho's views are taken from his Korean-language column in the Korea Daily. City rates were cross-checked across his column, Radio Seoul and The Tax Shack; exact rates by address should be confirmed with the CDTFA lookup tool.