Palmdale and Lancaster Sales Tax Rates Increase to 11.250%, Now the Highest in California

Effective April 1, 2025, the cities of Palmdale and Lancaster will both see an increase in their sales and use tax rates, rising from 10.250% to 11.250%. This makes both cities the highest in California for sales tax, surpassing all other cities in the state. The increase follows the approval of Measure A in the November 2024 election, where voters in both cities approved the tax changes designed to fund important local services and infrastructure projects.

Measure A and the Tax Changes

Measure A, which was passed by voters in the November 2024 election, has significantly impacted the tax structure in Palmdale and Lancaster. The measure approved a 0.750% tax increase on top of a new countywide tax. Specifically, Measure A repealed the previous 0.250% countywide tax that was added by Measure H and introduced a new 0.500% countywide tax. As a result, both cities will see an increase of 0.750% in their local sales tax rates, bringing the total tax rate in both Palmdale and Lancaster to 11.250%.

This new tax rate will make Palmdale and Lancaster the highest cities in California for sales tax. The additional revenue generated from this increase will be allocated to vital community projects, such as infrastructure improvements, public safety, education, and road maintenance. The changes come as part of a larger effort to ensure that the cities can continue to grow and provide essential services to their residents.

How the New Tax Rate Affects Businesses and Residents

The increase in sales tax rates means that businesses in both Palmdale and Lancaster will need to adjust their pricing and point-of-sale systems to reflect the new 11.250% rate. Retail businesses, restaurants, and other consumer-facing industries will be particularly affected, as the higher tax will result in increased prices for goods and services. This could lead to changes in consumer behavior, as residents and visitors may factor the higher tax into their purchasing decisions.

For residents, the increased tax will apply to a wide range of purchases, from everyday items like groceries and clothing to larger consumer goods. While the additional revenue will support much-needed local services, the higher tax burden may have some impact on household budgets.

New Tax Code Required

As a result of Measure A, the tax rate change will require a new tax code for both cities. Businesses will need to ensure they are compliant with the new regulations, and systems must be updated to accurately calculate and charge the new sales tax rate of 11.250%. This is especially important for businesses that operate in both Palmdale and Lancaster, as they will need to adjust for the newly introduced countywide tax code.

Why the Tax Increase Was Approved

The tax increase was approved after extensive campaigning and discussions about the need for more funding to support the growing needs of Palmdale and Lancaster. Proponents of Measure A argue that the additional revenue will help support essential services such as road maintenance, public safety, and community development, which are crucial for maintaining the quality of life in both cities. The cities are experiencing rapid growth, and the increased revenue will help ensure that infrastructure and public services keep pace with this growth.

While the tax increase has raised concerns among some residents and businesses about the added financial burden, supporters believe that it is necessary for the long-term health of the communities. The funding will also be used to improve roads, enhance public safety, and support local schools and community programs.

Preparing for the Change

As we approach the April 1, 2025, deadline for the new tax rate to take effect, businesses in Palmdale and Lancaster should take steps to update their systems and ensure compliance with the new 11.250% tax rate. Retailers and other businesses that collect sales tax will need to modify their point-of-sale systems and adjust their pricing to reflect the higher rate. Consumers should also be aware of the changes and prepare for higher prices on a variety of goods and services.

To help businesses and residents understand the tax changes, the California Department of Tax and Fee Administration (CDTFA) will provide a downloadable spreadsheet of the updated tax rates, which will be available starting March 1, 2025. These updated rates will be searchable on the CDTFA website beginning April 1, 2025. Businesses can also access more information and find specific tax rates for their location by visiting the CDTFA’s website.

The approval of Measure A in the November 2024 election marks a significant change for Palmdale and Lancaster, as the cities’ sales tax rates increase to 11.250%. This makes both cities the highest in California for sales tax, and the new rates are expected to provide much-needed funding for local services and infrastructure projects. While the increase has sparked mixed reactions, the additional revenue will help address the growing demands of both cities as they continue to expand. As the implementation date of April 1, 2025, approaches, businesses and residents should prepare for the new tax rates and stay informed about the upcoming changes.