City Council To Consider Sales Tax Increase Measure

BEVERLY HILLS — The City Council of Beverly Hills will consider the possibility of implementing a three-quarter cent sales tax increase during its next virtual meeting on July 14. 

In a staff report from Policy and Management Analyst Cynthia Owens, city staff provided information on how the measure could be up for voter approval on the next election ballot. 

The current sales tax in Beverly Hills is 9.50 percent. 1 percent gets returned to the city, while the other 8.50 percent goes to the state, Los Angeles County, and other special districts.

“Should the City place a 3⁄4 cent sales tax on the ballot, the City would retain the entire 3⁄4 cents as general fund revenue should it pass and go into effect,” the city staff report says. 

The legal maximum for sales taxes in the state of California is 10.25 percent. As the report explains, Los Angeles County “or other governmental entity (‘District’) can impose sales taxes in both unincorporated areas and cities.” However, any “District regional tax” cannot be collected within a city that already collects sales taxes up to the maximum of 10.25 percent.

A number of L.A County cities have approved sales tax increases up to the 10.25 percent maximum. Burbank, Glendale, Long Beach, Santa Monica, and 21 others have done so.

A similar measure was up for approval on the ballot of the city of Torrance’s March 3 election earlier in the year. “Measure X,” as it was called, failed with a 58.36 percent “No” vote.

The city staff report includes projections for the current 2019/20 Fiscal Year, the previous fiscal year, and the next fiscal year’s potential revenue gain from a three-quarter cent sales tax increase in Beverly Hills.

The city projects that the total revenue collected form sales taxes during the next fiscal year (2020/21) will be approximately $22 million. The possible sales tax measure would generate an approximately $16 million in extra revenue for the city, according to the report. 

The Beverly Hills City Council heard about the possibility of the measure during a Feb. 4 study session. The Council directed city staff to report to this week’s meeting with further information.