A little-known provision in AB1793 will reshape how California retailers handle cash payments—and the penalties for getting it wrong are serious.
Most California retail owners haven't heard of it yet, but a provision buried in AB1793 will fundamentally change how you collect cash payments. Starting July 1, 2027, every cash transaction at your physical location must be rounded to the nearest 5-cent increment before you collect payment. That means no more collecting exact amounts—and no flexibility on the rounding itself.
Under Section 1789.62(a) of Title 1.6H, California retailers must round all cash transactions to the nearest $0.05 increment. A $10.03 purchase rounds to $10.05. A $10.02 purchase rounds to $10.00. The rounding applies before collection—meaning you calculate the rounded amount first, then collect that amount from the customer.
The rule is straightforward on its face. The consequences are not.
If you collect even one cent more than the rounded amount, you trigger the same penalties as California's existing overcharging statute under Business and Professions Code §12024.2. That means:
In practical terms, a single day of cash sales with rounding errors could expose you to dozens of separate violations. This isn't a warning or a fine. It's a statutory liability framework that treats each transaction independently.
If you operate a physical retail location in California and accept cash, this applies to you. It doesn't matter whether you're a convenience store, restaurant, boutique, or gas station. The rule is universal for brick-and-mortar retailers.
Businesses that operate primarily online or cashless may not be directly affected, but any retailer with a physical storefront needs to plan for this.
The operative date is July 1, 2027—giving you time to prepare, but not unlimited time. Retailers should:
POS systems that can't handle 5-cent rounding will need to be updated or replaced. If your system rounds at checkout but allows manual override, you'll need to disable that override for cash transactions or establish strict controls to prevent it.
AB1793's cash rounding provision is a compliance requirement with real teeth. It's not optional, and it's not forgiving. Starting July 1, 2027, every cash transaction in your store will be subject to this rule, and violations carry criminal and civil liability. The time to understand this requirement and prepare your systems is now.
For detailed guidance on AB1793 compliance specific to your retail business, contact your local chamber of commerce or retail trade association.