Cash payments: calculation

The California Common Cents Act standardizes how merchants calculate purchases paid with U.S. coins or paper currency while preserving the original amount for taxes, fees, and surcharges.

What the law does ​

• Requires physical-location merchants to round cash-paid transaction totals ending in 1, 2, 6, or 7 cents down and totals ending in 3, 4, 8, or 9 cents up to the nearest five cents.
• Exempts totals of two cents or less and transactions paid entirely by noncash methods.
• Applies rounding to the cash-paid portion of mixed payments without changing the amount processed through a noncash system.
• Requires cash-related refunds to be rounded the same way.
• Excludes rounding adjustments from tax, fee, surcharge, and reimbursement calculations.
• Bars merchants from collecting more than the rounded amount and applies existing overcharge enforcement and penalties.

Who it affects ​

• Merchants selling goods or services at physical locations in California.
• Customers who pay all or part of a purchase in U.S. coins or paper currency.
• The California Department of Tax and Fee Administration, which may issue implementing regulations.

Context ​

The law becomes operative July 1, 2027.