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If a person, or a combined group as described in Section 956.3, engages in business activities described in more than one of Sections 953.1 through 953.7, inclusive, or engages in business activities listed in more than one of subsections 953.1(a)(2), 953.1(a)(3), 953.2(a)(2), 953.2(a)(3), 953.2(a)(4), 953.2(a)(5), 953.3(a)(2), 953.3(a)(3), 953.4(a)(2), 953.4(a)(3), 953.6(a)(2), and 953.6(a)(3), the rate or rates of gross receipts tax to be applied to that person or combined group, and the method for determining gross receipts in the City, shall be determined as follows:
(a) If more than 80% of its gross receipts, determined in accordance with Section 956, are derived from business activities described in only one of Sections 953.1 through 953.7, inclusive, then the rules of that applicable Section apply to all of its gross receipts derived from all business activities. If the Section from which the person or combined group derived more than 80% of its gross receipts includes different rates for different business activities described in that Section, then the rates applicable to the gross receipts that are deemed to be from business activities described in that Section shall be the rates that apply to the business activities within that Section from which the person or combined group derived the most taxable gross receipts, or if there is not a single business activity within that Section from which the person or combined group derived the most taxable gross receipts because the person or combined group derived the same amount of taxable gross receipts from one or more business activities within the Section, then the rates applicable to the gross receipts that are deemed to be from business activities described in that Section shall be the highest rates within that Section that apply to business activities from which the person or combined group derived the same amount of taxable gross receipts.
(b) If its business activities in the City are described in more than one of Sections 953.1 through 953.7, inclusive, or are listed in more than one of subsections 953.1(a)(2), 953.1(a)(3), 953.2(a)(2), 953.2(a)(3), 953.2(a)(4), 953.2(a)(5), 953.3(a)(2), 953.3(a)(3), 953.4(a)(2), 953.4(a)(3), 953.6(a)(2), and 953.6(a)(3), and, after applying subsection (a) of this Section 953.9, the person or combined group remains subject to the rates in more than one of Sections 953.1 through 953.7, inclusive, or more than one of subsections 953.1(a)(2), 953.1(a)(3), 953.2(a)(2), 953.2(a)(3), 953.2(a)(4), 953.2(a)(5), 953.3(a)(2), 953.3(a)(3), 953.4(a)(2), 953.4(a)(3), 953.6(a)(2), and 953.6(a)(3), then such person or combined group shall separately compute the gross receipts tax for each set of business activities as provided in the Section or subsection applicable to that particular set of business activities, modified as follows:
(1) if the set of business activities described in any of Sections 953.1 through 953.7, inclusive, generates less than 20% of the total gross receipts of the person or combined group, then the receipts and payroll of any such set of activities may be combined for all purposes related to computing the gross receipts tax with whichever set of that person’s or combined group’s activities are taxed at the highest rate;
(4) the applicable rate for each set of business activities shall be determined in numbered order of the Sections and subsections describing each set of business activities; e.g., the gross receipts and tax for business activities described in subsection 953.1(a)(2) should be determined first, subsection 953.1(a)(3) second, subsection 953.3(a)(2) third, and so on;
(5) the rate(s) applicable to any set of activities after the first shall be determined by adding together the gross receipts determined for all previous sets of activities and applying the rate scale commencing with the total gross receipts so determined; and
(6) the gross receipts tax liability for the person or combined group shall be the sum of the liabilities for each set of business activities.
(c) This Section 953.9 shall not apply to tax years beginning on or after January 1, 2025.
(Added by Proposition E, App. 11/6/2012, Oper. 1/1/2014; amended by Proposition F, 11/3/2020, Eff. 12/29/2020, Oper. 1/1/2021; Proposition M, 11/5/2024, Eff. 12/20/2024)
(Added by Proposition F, 11/3/2020, Eff. 12/29/2020, Oper. 1/1/2021; Proposition M, 11/5/2024, Eff. 12/20/2024)
(a) The gross receipts tax rates applicable to Category 1 Business Activities are:
(1) For tax years 2025 and 2026:
0.1% for taxable gross receipts between $0 and $1,000,000
0.13% for taxable gross receipts between $1,000,000.01 and $2,500,000
0.18% for taxable gross receipts between $2,500,000.01 and $25,000,000
0.336% for taxable gross receipts between $25,000,000.01 and $50,000,000
0.336% for taxable gross receipts between $50,000,000.01 and $75,000,000
0.336% for taxable gross receipts between $75,000,000.01 and $100,000,000
0.336% for taxable gross receipts between $100,000,000.01 and $150,000,000
0.504% for taxable gross receipts between $150,000,000.01 and $250,000,000
0.672% for taxable gross receipts between $250,000,000.01 and $500,000,000
0.84% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
1.008% for taxable gross receipts over $1,000,000,000
(2) For tax year 2027:
0.104% for taxable gross receipts between $0 and $1,000,000
0.135% for taxable gross receipts between $1,000,000.01 and $2,500,000
0.187% for taxable gross receipts between $2,500,000.01 and $25,000,000
0.356% for taxable gross receipts between $25,000,000.01 and $50,000,000
0.356% for taxable gross receipts between $50,000,000.01 and $75,000,000
0.356% for taxable gross receipts between $75,000,000.01 and $100,000,000
0.356% for taxable gross receipts between $100,000,000.01 and $150,000,000
0.534% for taxable gross receipts between $150,000,000.01 and $250,000,000
0.712% for taxable gross receipts between $250,000,000.01 and $500,000,000
0.89% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
1.068% for taxable gross receipts over $1,000,000,000
(3) For tax years beginning on or after January 1, 2028:
0.107% for taxable gross receipts between $0 and $1,000,000
0.139% for taxable gross receipts between $1,000,000.01 and $2,500,000
0.193% for taxable gross receipts between $2,500,000.01 and $25,000,000
0.372% for taxable gross receipts between $25,000,000.01 and $50,000,000
0.372% for taxable gross receipts between $50,000,000.01 and $75,000,000
0.372% for taxable gross receipts between $75,000,000.01 and $100,000,000
0.372% for taxable gross receipts between $100,000,000.01 and $150,000,000
0.557% for taxable gross receipts between $150,000,000.01 and $250,000,000
0.743% for taxable gross receipts between $250,000,000.01 and $500,000,000
0.929% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
1.115% for taxable gross receipts over $1,000,000,000
(b) “Category 1 Business Activities” means one or more of the business activities described in NAICS codes 42 (Wholesale Trade), 44 and 45 (Retail Trade), 532 (Rental and Leasing Services), 71 (Arts, Entertainment, and Recreation), 722 (Food Services and Drinking Places), 811 (Repair and Maintenance), 812 (Personal and Laundry Services) but not including 812930 (Parking Lots and Garages), and 813 (Religious, Grantmaking, Civic, Professional, and Similar Organizations).
(Added by Proposition M, 11/5/2024, Eff. 12/20/2024)
New Ordinance NoticePublisher's Note: This section has been ADDED by new legislation (Ord. 214-24
, approved 8/8/2024, effective 9/8/2024, oper. if approved by electorate and not terminated). The text of the amendment will be incorporated under the new section number when the amending legislation is operative.
(a) The gross receipts tax rates applicable to Category 2 Business Activities are:
(1) For tax years 2025 and 2026:
0.185% for taxable gross receipts between $0 and $1,000,000
0.201% for taxable gross receipts between $1,000,000.01 and $2,500,000
0.253% for taxable gross receipts between $2,500,000.01 and $25,000,000
0.331% for taxable gross receipts between $25,000,000.01 and $50,000,000
0.582% for taxable gross receipts between $50,000,000.01 and $75,000,000
0.582% for taxable gross receipts between $75,000,000.01 and $100,000,000
0.582% for taxable gross receipts between $100,000,000.01 and $150,000,000
0.582% for taxable gross receipts between $150,000,000.01 and $250,000,000
0.582% for taxable gross receipts between $250,000,000.01 and $500,000,000
0.582% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
0.582% for taxable gross receipts over $1,000,000,000
(2) For tax year 2027:
0.192% for taxable gross receipts between $0 and $1,000,000
0.209% for taxable gross receipts between $1,000,000.01 and $2,500,000
0.264% for taxable gross receipts between $2,500,000.01 and $25,000,000
0.351% for taxable gross receipts between $25,000,000.01 and $50,000,000
0.617% for taxable gross receipts between $50,000,000.01 and $75,000,000
0.617% for taxable gross receipts between $75,000,000.01 and $100,000,000
0.617% for taxable gross receipts between $100,000,000.01 and $150,000,000
0.617% for taxable gross receipts between $150,000,000.01 and $250,000,000
0.617% for taxable gross receipts between $250,000,000.01 and $500,000,000
0.617% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
0.617% for taxable gross receipts over $1,000,000,000
(3) For tax years beginning on or after January 1, 2028:
0.198% for taxable gross receipts between $0 and $1,000,000
0.215% for taxable gross receipts between $1,000,000.01 and $2,500,000
0.271% for taxable gross receipts between $2,500,000.01 and $25,000,000
0.366% for taxable gross receipts between $25,000,000.01 and $50,000,000
0.644% for taxable gross receipts between $50,000,000.01 and $75,000,000
0.644% for taxable gross receipts between $75,000,000.01 and $100,000,000
0.644% for taxable gross receipts between $100,000,000.01 and $150,000,000
0.644% for taxable gross receipts between $150,000,000.01 and $250,000,000
0.644% for taxable gross receipts between $250,000,000.01 and $500,000,000
0.644% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
0.644% for taxable gross receipts over $1,000,000,000
(b) “Category 2 Business Activities” means the business activities described in NAICS code 721 (Accommodation).
(c) The amount of taxable gross receipts from Category 2 Business Activities subject to the gross receipts tax shall be the total amount of gross receipts derived from or related to real properties located within the City.
(Added by Proposition M, 11/5/2024, Eff. 12/20/2024)
(a) The gross receipts tax rates applicable to Category 3 Business Activities are:
(1) For tax years 2025 and 2026:
0.413% for taxable gross receipts between $0 and $1,000,000
0.413% for taxable gross receipts between $1,000,000.01 and $2,500,000
0.435% for taxable gross receipts between $2,500,000.01 and $25,000,000
0.435% for taxable gross receipts between $25,000,000.01 and $50,000,000
0.435% for taxable gross receipts between $50,000,000.01 and $75,000,000
0.435% for taxable gross receipts between $75,000,000.01 and $100,000,000
0.435% for taxable gross receipts between $100,000,000.01 and $150,000,000
0.435% for taxable gross receipts between $150,000,000.01 and $250,000,000
0.435% for taxable gross receipts between $250,000,000.01 and $500,000,000
0.435% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
0.435% for taxable gross receipts over $1,000,000,000
(2) For tax year 2027:
0.43% for taxable gross receipts between $0 and $1,000,000
0.43% for taxable gross receipts between $1,000,000.01 and $2,500,000
0.452% for taxable gross receipts between $2,500,000.01 and $25,000,000
0.452% for taxable gross receipts between $25,000,000.01 and $50,000,000
0.465% for taxable gross receipts between $50,000,000.01 and $75,000,000
0.465% for taxable gross receipts between $75,000,000.01 and $100,000,000
0.465% for taxable gross receipts between $100,000,000.01 and $150,000,000
0.465% for taxable gross receipts between $150,000,000.01 and $250,000,000
0.465% for taxable gross receipts between $250,000,000.01 and $500,000,000
0.465% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
0.465% for taxable gross receipts over $1,000,000,000
(3) For tax years beginning on or after January 1, 2028:
0.442% for taxable gross receipts between $0 and $1,000,000
0.442% for taxable gross receipts between $1,000,000.01 and $2,500,000
0.466% for taxable gross receipts between $2,500,000.01 and $25,000,000
0.466% for taxable gross receipts between $25,000,000.01 and $50,000,000
0.489% for taxable gross receipts between $50,000,000.01 and $75,000,000
0.489% for taxable gross receipts between $75,000,000.01 and $100,000,000
0.489% for taxable gross receipts between $100,000,000.01 and $150,000,000
0.489% for taxable gross receipts between $150,000,000.01 and $250,000,000
0.489% for taxable gross receipts between $250,000,000.01 and $500,000,000
0.489% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
0.489% for taxable gross receipts over $1,000,000,000
(b) “Category 3 Business Activities” means one or more of the business activities described in NAICS codes 531 (Real Estate), 5612 (Facilities Support Services), 5617 (Services to Buildings and Dwellings), and 812930 (Parking Lots and Garages).
(c) The amount of taxable gross receipts from Category 3 Business Activities subject to the gross receipts tax shall be the total amount of gross receipts derived from or related to real properties located within the City.
(Added by Proposition M, 11/5/2024, Eff. 12/20/2024)
(a) The gross receipts tax rates applicable to Category 4 Business Activities are:
(1) For tax years 2025 and 2026:
0.25% for taxable gross receipts between $0 and $1,000,000
0.25% for taxable gross receipts between $1,000,000.01 and $2,500,000
0.3% for taxable gross receipts between $2,500,000.01 and $25,000,000
0.504% for taxable gross receipts between $25,000,000.01 and $50,000,000
0.84% for taxable gross receipts between $50,000,000.01 and $75,000,000
0.84% for taxable gross receipts between $75,000,000.01 and $100,000,000
1.176% for taxable gross receipts between $100,000,000.01 and $150,000,000
1.176% for taxable gross receipts between $150,000,000.01 and $250,000,000
1.344% for taxable gross receipts between $250,000,000.01 and $500,000,000
1.344% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
1.512% for taxable gross receipts over $1,000,000,000
(2) For tax year 2027:
0.26% for taxable gross receipts between $0 and $1,000,000
0.26% for taxable gross receipts between $1,000,000.01 and $2,500,000
0.312% for taxable gross receipts between $2,500,000.01 and $25,000,000
0.534% for taxable gross receipts between $25,000,000.01 and $50,000,000
0.89% for taxable gross receipts between $50,000,000.01 and $75,000,000
0.89% for taxable gross receipts between $75,000,000.01 and $100,000,000
1.246% for taxable gross receipts between $100,000,000.01 and $150,000,000
1.246% for taxable gross receipts between $150,000,000.01 and $250,000,000
1.424% for taxable gross receipts between $250,000,000.01 and $500,000,000
1.424% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
1.602% for taxable gross receipts over $1,000,000,000
(3) For tax years beginning on or after January 1, 2028:
0.268% for taxable gross receipts between $0 and $1,000,000
0.268% for taxable gross receipts between $1,000,000.01 and $2,500,000
0.321% for taxable gross receipts between $2,500,000.01 and $25,000,000
0.557% for taxable gross receipts between $25,000,000.01 and $50,000,000
0.929% for taxable gross receipts between $50,000,000.01 and $75,000,000
0.929% for taxable gross receipts between $75,000,000.01 and $100,000,000
1.301% for taxable gross receipts between $100,000,000.01 and $150,000,000
1.301% for taxable gross receipts between $150,000,000.01 and $250,000,000
1.486% for taxable gross receipts between $250,000,000.01 and $500,000,000
1.486% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
1.672% for taxable gross receipts over $1,000,000,000
(b) “Category 4 Business Activities” means one or more of the business activities described in NAICS codes 11 (Agriculture, Forestry, Fishing and Hunting), 21 (Mining, Quarrying, and Oil and Gas Extraction), 22 (Utilities), 31 through 33 (Manufacturing), 48 and 49 (Transportation and Warehousing), 524 (Insurance Carriers and Related Activities), 541714 (Research and Development in Biotechnology (except Nanobiotechnology)), 5611 (Office Administrative Services), 5613 (Employment Services), 5614 (Business Support Services), 5615 (Travel Arrangement and Reservation Services), 5616 (Investigation and Security Services), 5619 (Other Support Services), and 92 (Public Administration).
(Added by Proposition M, 11/5/2024, Eff. 12/20/2024)
(a) The gross receipts tax rates applicable to Category 5 Business Activities are:
(1) For tax years 2025 and 2026:
1% for taxable gross receipts between $0 and $1,000,000
1% for taxable gross receipts between $1,000,000.01 and $2,500,000
1.5% for taxable gross receipts between $2,500,000.01 and $25,000,000
1.176% for taxable gross receipts between $25,000,000.01 and $50,000,000
1.344% for taxable gross receipts between $50,000,000.01 and $75,000,000
1.344% for taxable gross receipts between $75,000,000.01 and $100,000,000
1.344% for taxable gross receipts between $100,000,000.01 and $150,000,000
1.512% for taxable gross receipts between $150,000,000.01 and $250,000,000
1.68% for taxable gross receipts between $250,000,000.01 and $500,000,000
1.68% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
1.68% for taxable gross receipts over $1,000,000,000
(2) For tax year 2027:
1.04% for taxable gross receipts between $0 and $1,000,000
1.04% for taxable gross receipts between $1,000,000.01 and $2,500,000
1.56% for taxable gross receipts between $2,500,000.01 and $25,000,000
1.246% for taxable gross receipts between $25,000,000.01 and $50,000,000
1.424% for taxable gross receipts between $50,000,000.01 and $75,000,000
1.424% for taxable gross receipts between $75,000,000.01 and $100,000,000
1.424% for taxable gross receipts between $100,000,000.01 and $150,000,000
1.602% for taxable gross receipts between $150,000,000.01 and $250,000,000
1.78% for taxable gross receipts between $250,000,000.01 and $500,000,000
1.78% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
1.78% for taxable gross receipts over $1,000,000,000
(3) For tax years beginning on or after January 1, 2028:
1.071% for taxable gross receipts between $0 and $1,000,000
1.071% for taxable gross receipts between $1,000,000.01 and $2,500,000
1.607% for taxable gross receipts between $2,500,000.01 and $25,000,000
1.301% for taxable gross receipts between $25,000,000.01 and $50,000,000
1.486% for taxable gross receipts between $50,000,000.01 and $75,000,000
1.486% for taxable gross receipts between $75,000,000.01 and $100,000,000
1.486% for taxable gross receipts between $100,000,000.01 and $150,000,000
1.672% for taxable gross receipts between $150,000,000.01 and $250,000,000
1.858% for taxable gross receipts between $250,000,000.01 and $500,000,000
1.858% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
1.858% for taxable gross receipts over $1,000,000,000
(b) “Category 5 Business Activities” means one or more of the business activities described in NAICS codes 51 (Information), 5222 (Nondepository Credit Intermediation), 5223 (Activities Related to Credit Intermediation)), 533 (Lessors of Nonfinancial Intangible Assets (except Copyrighted Works)), 54 (Professional, Scientific, and Technical Services) but not including 541714 (Research and Development in Biotechnology (except Nanobiotechnology)), 55 (Management of Companies and Enterprises), 562 (Waste Management and Remediation Services), 61 (Educational Services), 62 (Health Care and Social Assistance), and all business activities not otherwise exempt and not elsewhere subjected to a gross receipts tax rate by Sections 953.20 through 953.26 or an administrative office tax under Section 953.8.
(Added by Proposition M, 11/5/2024, Eff. 12/20/2024)
(a) The gross receipts tax rates applicable to Category 6 Business Activities are:
(1) For tax years 2025 and 2026:
1.5% for taxable gross receipts between $0 and $1,000,000
1.5% for taxable gross receipts between $1,000,000.01 and $2,500,000
3% for taxable gross receipts between $2,500,000.01 and $25,000,000
2.352% for taxable gross receipts between $25,000,000.01 and $50,000,000
3.024% for taxable gross receipts between $50,000,000.01 and $75,000,000
3.024% for taxable gross receipts between $75,000,000.01 and $100,000,000
3.36% for taxable gross receipts between $100,000,000.01 and $150,000,000
3.36% for taxable gross receipts between $150,000,000.01 and $250,000,000
3.36% for taxable gross receipts between $250,000,000.01 and $500,000,000
3.36% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
3.36% for taxable gross receipts over $1,000,000,000
(2) For tax year 2027:
1.56% for taxable gross receipts between $0 and $1,000,000
1.56% for taxable gross receipts between $1,000,000.01 and $2,500,000
3.12% for taxable gross receipts between $2,500,000.01 and $25,000,000
2.492% for taxable gross receipts between $25,000,000.01 and $50,000,000
3.204% for taxable gross receipts between $50,000,000.01 and $75,000,000
3.204% for taxable gross receipts between $75,000,000.01 and $100,000,000
3.56% for taxable gross receipts between $100,000,000.01 and $150,000,000
3.56% for taxable gross receipts between $150,000,000.01 and $250,000,000
3.56% for taxable gross receipts between $250,000,000.01 and $500,000,000
3.56% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
3.56% for taxable gross receipts over $1,000,000,000
(3) For tax years beginning on or after January 1, 2028:
1.607% for taxable gross receipts between $0 and $1,000,000
1.607% for taxable gross receipts between $1,000,000.01 and $2,500,000
3.214% for taxable gross receipts between $2,500,000.01 and $25,000,000
2.601% for taxable gross receipts between $25,000,000.01 and $50,000,000
3.344% for taxable gross receipts between $50,000,000.01 and $75,000,000
3.344% for taxable gross receipts between $75,000,000.01 and $100,000,000
3.716% for taxable gross receipts between $100,000,000.01 and $150,000,000
3.716% for taxable gross receipts between $150,000,000.01 and $250,000,000
3.716% for taxable gross receipts between $250,000,000.01 and $500,000,000
3.716% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
3.716% for taxable gross receipts over $1,000,000,000
(b) “Category 6 Business Activities” means one or more of the business activities described in NAICS codes 521 (Monetary Authorities-Central Bank), 5221 (Depository Credit Intermediation), 523 (Securities, Commodity Contracts, and Other Financial Investments and Related Activities), and 525 (Funds, Trusts, and other Financial Vehicles).
(Added by Proposition M, 11/5/2024, Eff. 12/20/2024)
(a) The gross receipts tax rates applicable to Category 7 Business Activities are:
(1) For tax years 2025 and 2026:
0.5% for taxable gross receipts between $0 and $1,000,000
0.5% for taxable gross receipts between $1,000,000.01 and $2,500,000
0.75% for taxable gross receipts between $2,500,000.01 and $25,000,000
0.672% for taxable gross receipts between $25,000,000.01 and $50,000,000
1.008% for taxable gross receipts between $50,000,000.01 and $75,000,000
1.008% for taxable gross receipts between $75,000,000.01 and $100,000,000
1.344% for taxable gross receipts between $100,000,000.01 and $150,000,000
1.344% for taxable gross receipts between $150,000,000.01 and $250,000,000
1.512% for taxable gross receipts between $250,000,000.01 and $500,000,000
1.512% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
1.68% for taxable gross receipts over $1,000,000,000
(2) For tax year 2027:
0.52% for taxable gross receipts between $0 and $1,000,000
0.52% for taxable gross receipts between $1,000,000.01 and $2,500,000
0.78% for taxable gross receipts between $2,500,000.01 and $25,000,000
0.712% for taxable gross receipts between $25,000,000.01 and $50,000,000
1.068% for taxable gross receipts between $50,000,000.01 and $75,000,000
1.068% for taxable gross receipts between $75,000,000.01 and $100,000,000
1.424% for taxable gross receipts between $100,000,000.01 and $150,000,000
1.424% for taxable gross receipts between $150,000,000.01 and $250,000,000
1.602% for taxable gross receipts between $250,000,000.01 and $500,000,000
1.602% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
1.78% for taxable gross receipts over $1,000,000,000
(3) For tax years beginning on or after January 1, 2028:
0.536% for taxable gross receipts between $0 and $1,000,000
0.536% for taxable gross receipts between $1,000,000.01 and $2,500,000
0.803% for taxable gross receipts between $2,500,000.01 and $25,000,000
0.743% for taxable gross receipts between $25,000,000.01 and $50,000,000
1.115% for taxable gross receipts between $50,000,000.01 and $75,000,000
1.115% for taxable gross receipts between $75,000,000.01 and $100,000,000
1.486% for taxable gross receipts between $100,000,000.01 and $150,000,000
1.486% for taxable gross receipts between $150,000,000.01 and $250,000,000
1.672% for taxable gross receipts between $250,000,000.01 and $500,000,000
1.672% for taxable gross receipts between $500,000,000.01 and $1,000,000,000
1.858% for taxable gross receipts over $1,000,000,000
(b) “Category 7 Business Activities” means the business activities described in NAICS code 23 (Construction).
(c) Except as otherwise provided in subsection (d), the amount of taxable gross receipts from Category 7 Business Activities subject to the gross receipts tax shall be the total amount of gross receipts derived from or related to real properties located within the City.
(d) The amount of taxable gross receipts determined under subsection (c) shall be reduced by any amounts that were included in a person or combined group’s gross receipts under subsection (c) and that the person or combined group paid to a subcontractor for work related to the real properties located with the City during the tax year. There shall be no deduction for any other costs, including without limitation costs for materials, fees, equipment, or other services. To claim such a deduction, a person must maintain an itemized schedule of payments to subcontractors.
(Added by Proposition M, 11/5/2024, Eff. 12/20/2024)
For tax years beginning on or after January 1, 2025, if a person, or a combined group as described in Section 956.3, derives gross receipts from more than one of Business Activity Categories 1 through 7, inclusive:
(a) If the person or combined group has $10,000 or less in gross receipts from any one of Business Activity Categories 1 through 7, inclusive, before allocating or apportioning gross receipts under Section 956, such person or combined group may combine those gross receipts for all purposes related to computing the gross receipts tax with the gross receipts from whichever of Business Activity Categories 1 through 7, inclusive, generated the most gross receipts for the person or combined group, before allocating or apportioning gross receipts under Section 956. If there is no Business Activity Category that generated the most gross receipts for the person or combined group because the person or combined group generated the same amount of gross receipts from one or more Business Activity Categories, then such person or combined group may combine the gross receipts in this subsection (a) for all purposes related to computing the gross receipts tax with the gross receipts from whichever Business Activity Category has the highest rates among the Business Activity Categories that generated the same amount of gross receipts.
(b) If the person or combined group continues to derive gross receipts from more than one of Business Activity Categories 1 through 7, inclusive, after applying subsection (a) of this Section 953.27, then such person or combined group shall separately compute the gross receipts tax for each Business Activity Category as provided in the Section applicable to that particular Business Activity Category as follows:
(2) The gross receipts tax liability for the person or combined group shall be the sum of the liabilities for each Business Activity Category.
(Added by Proposition M, 11/5/2024, Eff. 12/20/2024)
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