California no longer has a luxury tax. A luxury tax is a tax placed on certain goods that are not considered essential.
The most recent luxury tax enacted in the United States was part of a bill signed by President George H. W. Bush at the end of 1991. Congress eliminated the tax two years later because it did not achieve its goal. When it was in place, the luxury tax affected the price of expensive items, such as luxury automobiles, yachts, jewelry, and furs. The purpose of the tax was to generate additional revenue to reduce the federal budget deficit. In most cases, the luxury tax did not affect the average consumer unless he or she splurged on a luxury item.