California’s modified origin-based sales tax system differentiates between origin and destination taxes by combining elements of both systems:

• Origin-Based Taxation: The base state sales tax rate of 7.5% is determined by the seller’s location where the sale originates.

• Destination-Based Taxation: Additional local district taxes are based on the buyer’s delivery location. This means that while the state tax is collected based on the seller’s address, any local taxes added are determined by where the buyer receives the goods.

This hybrid approach ensures that businesses apply the state base rate from their origin while adding any applicable local taxes from the buyer’s destination. It simplifies tax collection for single-location businesses by using a single origin-based rate, while also ensuring that localities receive their due share of sales tax based on where the goods are consumed.