Chapter 5.06
BUSINESS LICENSE TAX RATES1
Sections:
5.06.040 Multifamily residential rental tax.
5.06.060 Alternate license tax for solicitors, farmer’s market vendors and street fair participants.
5.06.070 Inflation adjustment.
5.06.010 Definitions.
Except where indicated to the contrary or where the context clearly requires to the contrary, all terms used in this chapter shall have the meanings given in Chapter 5.04 BMC. (Ord. 04-10 § 1).
5.06.020 Total tax due.
Except as otherwise provided in BMC 5.06.060, the license tax due pursuant to BMC 5.04.030 with respect to any business shall be the sum of:
A. The personnel tax imposed by BMC 5.06.030;
B. The multifamily residential rental tax imposed by BMC 5.06.040; and
C. The gross receipts tax imposed by BMC 5.06.050.
The requirements of this chapter shall apply only to persons required to pay a license tax pursuant to BMC 5.04.030. (Ord. 04-10 § 1).
5.06.030 Personnel tax.
A. Each person who employs or compensates another shall pay an annual personnel tax of $7.50 for each person he or she employs or compensates.
B. For purposes of this section, persons deemed to be employed or compensated by a person subject to the license tax include:
1. Employees to whom the person subject to the license tax pays wages reportable on Internal Revenue Service Form W-2 or its successor; and
2. Other persons to whom the person subject to the license tax pays compensation, but only if (a) the person subject to the license tax is obligated to report such compensation in Box 7 of Internal Revenue Service Form 1099-MISC, as that form existed in November 2004, and (b) the person receiving compensation had not been issued a business license tax certificate by the city valid during the period for which compensation was paid.
C. If a person subject to the personnel tax imposed under this section employed or compensated one or more persons for fewer than 2,000 hours of services in the calendar year prior to the year in which the tax is due, then that taxpayer shall pay the tax due under this section with respect to that person or those persons in the amount of $7.50 multiplied by a fraction, the numerator of which is the number of hours of service performed by all such persons in the calendar year prior to the year in which the tax is due, and the denominator of which is 2,000 hours. (Ord. 04-10 § 1).
5.06.040 Multifamily residential rental tax.
A. This section shall apply to persons engaging in the business of renting or leasing multifamily property in the city for residential tenancies of 30 or more days. Persons engaging in this type of business are not subject to a gross receipts calculation pursuant to BMC 5.06.050 or a personnel tax pursuant to BMC 5.06.030. The record owner of a property that is rented or leased for such tenancies shall be presumed to be the person renting or leasing the property and liable for the tax due under this section unless that record owner demonstrates to the satisfaction of the administrator that some other person is engaged in the business of renting or leasing a particular property, in which case that other person shall be liable for the tax due under this section as to that property.
B. Each person subject to this section shall pay a multifamily residential rental tax of $36.00 for each rental unit for which that person receives any rent during the calendar year prior to the year in which the tax is due.
C. Notwithstanding the provisions of subsection (B) of this section, no multifamily residential rental tax shall be due with respect to any rental unit that the person subject to this section can establish, in a manner satisfactory to the administrator:
1. To be a rental unit located in a building containing three or fewer other such rental units; or
2. To have been occupied for at least half of the period during which it was rented to any tenant in the calendar year prior to the year in which the tax is due by:
a. A head of household who is 65 years of age or older; or
b. A "lower income household" as that term is defined in Section 50075.9 of the California Health and Safety Code, as it now exists or may hereafter be amended.
D. A person who is subject to the multifamily residential rental tax shall not be subject to the gross receipts tax imposed pursuant to BMC 5.06.050 with respect to gross receipts derived from the rental or leasing of residential rental units in the city. (Ord. 04-10 § 1).
5.06.050 Gross receipts tax.
A. Any person who engages in the business of providing professional services shall pay a gross receipts tax of $0.75 per $1,000 of gross receipts received in the calendar year prior to the year in which the tax is due, but not less than $75.00 per year.
B. Any person who engages in the business of retailing, operating a hotel or motel, or providing services (other than professional services) to the general public shall pay a gross receipts tax of $0.65 per $1,000 of gross receipts received in the calendar year prior to the year in which the tax is due, but not less than $65.00 per year.
C. Any person who engages in any business other than a business specified in subsections (A) and (B) of this section shall pay a gross receipts tax of $0.55 per $1,000 of gross receipts received in the calendar year prior to the year in which the tax is due, but not less than $55.00 per year.
D. The maximum gross receipts tax that any person shall be required to pay pursuant to this section with respect to any year shall be $450.00. (Ord. 04-10 § 1).
5.06.060 Alternate license tax for solicitors, farmer’s market vendors and street fair participants.
A. The license tax due pursuant to BMC 5.06.020 with respect to a person engaged in the business of soliciting in the city shall be $15.00 for each day that the person engages in soliciting and shall be payable monthly beginning on the first date in each calendar year in which that person conducts business in the city.
B. The license tax due pursuant to BMC 5.06.020 with respect to a person engaged in the business of vending at a farmer’s market in the city shall be $15.00 per year and shall be payable five days before the beginning of business and shall be remitted on behalf of the licensee by the sponsor of the farmer’s market.
C. The license tax due pursuant to BMC 5.06.020 with respect to a person engaged in the business of participating in a street or community fair shall be $15.00 per street or community fair and shall be payable before the commencement of business and shall be remitted on behalf of the licensee by the sponsor of the street or community fair. If a street or community fair lasts for more than three consecutive days, the tax shall be due for each whole or partial three-consecutive-day period during which a person engages in business in the city. (Ord. 04-10 § 1).
5.06.070 Inflation adjustment.
A. By November 30th of each year, beginning in 2005, the administrator shall adjust in the manner required by this section each of the following tax rates or amounts, and those adjusted rates or amounts shall be used in calculating taxes due in the following calendar year:
1. The rate of the personnel tax set forth in BMC 5.06.030;
2. The rate of the residential rental tax set forth in BMC 5.06.040;
3. The maximum gross receipts tax amount set forth in BMC 5.06.050(D); and
4. Each of the license tax rates and amounts set forth in BMC 5.06.060.
B. Each rate or amount shall be adjusted for inflation by multiplying the then-effective rate by the lower of:
1. The annual increase in the Consumer Price Index for All Urban Consumers, San Francisco Bay Area (or any successor to that index) for the most recent 12 months for which data have been published when the adjustment is calculated; or
2. The average annual increase in the Consumer Price Index for All Urban Consumers, San Francisco Bay Area (or any successor to that index) over the five most recent 12-month periods for which data have been published when this calculation is made.
C. The administrator shall publish the adjusted rates and amounts by December 15th of each year, beginning in 2005, in the manner required for publication of ordinances of the city.
D. The city council may, by resolution, suspend the effectiveness of all or part of one or more such adjustments for such period or periods as it may determine. However, such suspension shall not be taken into account by the administrator when making the calculations required by this section. The expiration or termination of any such suspension shall not require voter approval; provided, that the tax is not imposed on any person in an amount in excess of the inflation-adjusted rates or amounts authorized by this chapter. (Ord. 04-10 § 1).
Prior legislation: Ord. 04-12.