Los Angeles County Municipal Code Ch. 4.70 Essential Services Restoration Act for Los Angeles County General Retail

This Chapter shall be known as the "Essential Services Restoration Act for Los Angeles County General Retail Transactions and Use Tax" ordinance. The County of Los Angeles hereinafter shall be called "County." This ordinance shall be applicable in the incorporated and unincorporated territory of the County.

(Ord. 2026-0017 § 1, 2026.)

The Essential Services Restoration Act for Los Angeles County General Retail Transactions and Use Tax hereby adopted is enacted solely for general governmental purposes for the County and not for specific purposes. All of the proceeds from the tax imposed by this ordinance shall be placed in the County's general fund and used for purposes consistent with general fund expenditures of the County.

(Ord. 2026-0017 § 1, 2026.)

The "Operative Date" means the first day of the first calendar quarter commencing more than 110 days after the election on this ordinance.

(Ord. 2026-0017 § 1, 2026.)

This ordinance is adopted to achieve the following, among other purposes, and directs that the provisions hereof be interpreted in order to accomplish those purposes:

A.

To impose a retail transactions and use tax in accordance with the provisions of Part 1.6 (commencing with section 7251) of Division 2 of the Revenue and Taxation Code and section 7285 of Part 1.7 of Division 2, which authorizes the County to adopt this tax ordinance and shall be operative if a majority of the electors voting on the measure vote to approve the imposition of the tax at an election called for that purpose.

B.

To adopt a retail transactions and use tax ordinance that incorporates provisions identical to those of the Sales and Use Tax Law of the State of California insofar as those provisions are not inconsistent with the requirements and limitations contained in Part 1.6 of Division 2 of the Revenue and Taxation Code, including adoption by reference of the provisions of sections 7261 and 7262 of the Revenue and Taxation Code, as now in effect or as later amended.

C.

To adopt a retail transactions and use tax ordinance that imposes a tax and provides a measure therefor that can be administered and collected by the California Department of Tax and Fee Administration in a manner that adapts itself as fully as practicable to, and requires the least possible deviation from, the existing statutory and administrative procedures followed by the California Department of Tax and Fee Administration in administering and collecting the California State Sales and Use Taxes.

D.

To adopt a retail transactions and use tax ordinance that can be administered in a manner that will be, to the greatest degree possible, consistent with the provisions of Part 1.6 of Division 2 of the Revenue and Taxation Code, minimize the cost of collecting the retail transactions and use taxes, and at the same time, minimize the burden of record keeping upon persons subject to taxation under the provisions of this ordinance.

(Ord. 2026-0017 § 1, 2026.)

Prior to the Operative Date, the County shall contract with the California Department of Tax and Fee Administration to perform all functions incident to the administration and operation of this retail transactions and use tax ordinance; provided, that if the County shall not have contracted with the California Department of Tax and Fee Administration prior to the Operative Date, it shall nevertheless so contract and in such a case the Operative Date shall be the first day of the first calendar quarter following the execution of such a contract.

(Ord. 2026-0017 § 1, 2026.)

For the privilege of selling tangible personal property at retail, a tax is hereby imposed upon all retailers in the incorporated and unincorporated territory of the County at the rate of one-half percent (0.5%) of the gross receipts of any retailer from the sale of all tangible personal property sold at retail in said territory on and after the Operative Date of this ordinance.

(Ord. 2026-0017 § 1, 2026.)

For the purposes of this ordinance, all retail sales are consummated at the place of business of the retailer unless the tangible personal property sold is delivered by the retailer or his agent to an out-of-state destination or to a common carrier for delivery to an out-of-state destination. The gross receipts from such sales shall include delivery charges, when such charges are subject to the State sales and use tax, regardless of the place to which delivery is made. In the event a retailer has no permanent place of business in the State or has more than one place of business, the place or places at which the retail sales are consummated shall be determined under rules and regulations to be prescribed and adopted by the California Department of Tax and Fee Administration.

(Ord. 2026-0017 § 1, 2026.)

An excise tax is hereby imposed on the storage, use, or other consumption in the County of tangible personal property purchased from any retailer on and after the Operative Date of this ordinance for storage, use, or other consumption in said territory at the rate of one-half percent (0.5%) of the sales price of the property. The sales price shall include delivery charges when such charges are subject to State sales or use tax regardless of the place to which delivery is made.

(Ord. 2026-0017 § 1, 2026.)

Except as otherwise provided in this ordinance and except insofar as they are inconsistent with the provisions of Part 1.6 of Division 2 of the Revenue and Taxation Code, all of the provisions of Part 1 (commencing with section 6001) of Division 2 of the Revenue and Taxation Code are hereby adopted and made a part of this ordinance as though fully set forth herein.

(Ord. 2026-0017 § 1, 2026.)

In adopting the provisions of Part 1 of Division 2 of the Revenue and Taxation Code:

A.

Wherever the State of California is named or referred to as the taxing agency, the name of this County shall be substituted therefor. However, the substitution shall not be made when:

The word "State" is used as a part of the title of the State Controller, State Treasurer, State Board of Equalization, State Treasury, or the Constitution of the State of California;

The result of that substitution would require action to be taken by or against this County or any agency, officer, or employee thereof rather than by or against the California Department of Tax and Fee Administration, in performing the functions incident to the administration or operation of this ordinance.

In those sections, including, but not necessarily limited to, sections referring to the exterior boundaries of the State of California, where the result of the substitution would be to:

a.

Provide an exemption from this tax with respect to certain sales, storage, use or other consumption of tangible personal property which would not otherwise be exempt from this tax while such sales, storage, use, or other consumption remain subject to tax by the State under the provisions of Part 1 of Division 2 of the Revenue and Taxation Code, or;

b.

Impose this tax with respect to certain sales, storage, use, or other consumption of tangible personal property which would not be subject to tax by the State under the said provision of that code.

In sections 6701, 6702 (except in the last sentence thereof), 6711, 6715, 6737, 6797, or 6828 of the Revenue and Taxation Code.

B.

The word "County" shall be substituted for the word "State" in the phrase "retailer engaged in business in this State" in section 6203 of the Revenue and Taxation Code, and in the definition of that phrase in section 6203.

"A retailer engaged in business in the County" shall also include any retailer that, in the preceding calendar year or the current calendar year, has total combined sales of tangible personal property in this State or for delivery in the State by the retailer and all persons related to the retailer that exceeds five hundred thousand dollars ($500,000). For purposes of this Section, a person is related to another person if both persons are related to each other pursuant to section 267(b) of Title 26 of the United States Code and the regulations thereunder.

(Ord. 2026-0017 § 1, 2026.)

If a seller's permit has been issued to a retailer under section 6067 of the Revenue and Taxation Code, an additional transactor's permit shall not be required by this ordinance.

(Ord. 2026-0017 § 1, 2026.)

A.

There shall be excluded from the measure of the transactions tax and the use tax the amount of any sales tax or use tax imposed by the State of California or by any city, city and county, or county pursuant to the Bradley-Burns Uniform Local Sales and Use Tax Law or the amount of any state-administered transactions or use tax.

B.

There are exempted from the computation of the amount of transactions tax the gross receipts from:

Sales of tangible personal property, other than fuel or petroleum products, to operators of aircraft to be used or consumed principally outside the County in which the sale is made and directly and exclusively in the use of such aircraft as common carriers of persons or property under the authority of the laws of this State, the United States, or any foreign government.

Sales of property to be used outside the County which is shipped to a point outside the County, pursuant to the contract of sale, by delivery to such point by the retailer or his agent, or by delivery by the retailer to a carrier for shipment to a consignee at such point. For the purposes of this paragraph, delivery to a point outside the County shall be satisfied:

a.

With respect to vehicles (other than commercial vehicles) subject to registration pursuant to Chapter 1 (commencing with section 4000) of Division 3 of the Vehicle Code, aircraft licensed in compliance with section 21411 of the Public Utilities Code, and undocumented vessels registered under Division 3.5 (commencing with section 9840) of the Vehicle Code by registration to an out-of-County address and by a declaration under penalty of perjury, signed by the buyer, stating that such address is, in fact, his or her principal place of residence; and

b.

With respect to commercial vehicles, by registration to a place of business out-of-County and declaration under penalty of perjury, signed by the buyer, that the vehicle will be operated from that address.

The sale of tangible personal property if the seller is obligated to furnish the property for a fixed price pursuant to a contract entered into prior to the Operative Date of this ordinance.

A lease of tangible personal property which is a continuing sale of such property, for any period of time for which the lessor is obligated to lease the property for an amount fixed by the lease prior to the Operative Date of this ordinance.

For the purposes of subparagraphs 3 and 4 of this Section, the sale or lease of tangible personal property shall be deemed not to be obligated pursuant to a contract or lease for any period of time for which any party to the contract or lease has the unconditional right to terminate the contract or lease upon notice, whether or not such right is exercised.

C.

There are exempted from the use tax imposed by this ordinance, the storage, use or other consumption in this County of tangible personal property:

The gross receipts from the sale of which have been subject to a transactions tax under any state-administered transactions and use tax ordinance.

Other than fuel or petroleum products purchased by operators of aircraft and used or consumed by such operators directly and exclusively in the use of such aircraft as common carriers of persons or property for hire or compensation under a certificate of public convenience and necessity issued pursuant to the laws of this State, the United States, or any foreign government. This exemption is in addition to the exemptions provided in sections 6366 and 6366.1 of the Revenue and Taxation Code.

If the purchaser is obligated to purchase the property for a fixed price pursuant to a contract entered into prior to the Operative Date of this ordinance.

If the possession of, or the exercise of any right or power over, the tangible personal property arises under a lease which is a continuing purchase of such property for any period of time for which the lessee is obligated to lease the property for an amount fixed by a lease prior to the Operative Date of this ordinance.

For the purposes of subparagraphs 3 and 4 of this Section, storage, use, or other consumption, or possession of, or exercise of any right or power over, tangible personal property shall be deemed not to be obligated pursuant to a contract or lease for any period of time for which any party to the contract or lease has the unconditional right to terminate the contract or lease upon notice, whether or not such right is exercised.

Except as provided in subparagraph 7, a retailer engaged in business in the County shall not be required to collect use tax from the purchaser of tangible personal property, unless the retailer ships or delivers the property into the County or participates within the County in making the sale of the property, including, but not limited to, soliciting or receiving the order, either directly or indirectly, at a place of business of the retailer in the County or through any representative, agent, canvasser, solicitor, subsidiary, or person in the County under the authority of the retailer.

"A retailer engaged in business in the County" shall also include any retailer of any of the following: vehicles subject to registration pursuant to Chapter 1 (commencing with section 4000) of Division 3 of the Vehicle Code, aircraft licensed in compliance with section 21411 of the Public Utilities Code, or undocumented vessels registered under Division 3.5 (commencing with section 9840) of the Vehicle Code. That retailer shall be required to collect use tax from any purchaser who registers or licenses the vehicle, vessel, or aircraft at an address in the County.

D.

Any person subject to use tax under this ordinance may credit against that tax any transactions tax or reimbursement for transactions tax paid to a County imposing, or retailer liable for a transactions tax pursuant to Part 1.6 of Division 2 of the Revenue and Taxation Code with respect to the sale to the person of the property the storage, use, or other consumption of which is subject to the use tax.

(Ord. 2026-0017 § 1, 2026.)

A.

All amendments subsequent to the effective date of this ordinance to Part 1 of Division 2 of the Revenue and Taxation Code relating to sales and use taxes and which are not inconsistent with Part 1.6 and Part 1.7 of Division 2 of the Revenue and Taxation Code, and all amendments to Part 1.6 and Part 1.7 of Division 2 of the Revenue and Taxation Code, shall automatically become a part of this ordinance, provided, however, that no such amendment shall operate so as to affect the rate of tax imposed by this ordinance.

B.

The Board of Supervisors may repeal this ordinance or amend it in a manner which does not result in an increase in the tax imposed herein, without further voter approval. The Board of Supervisors may likewise by ordinance adopt and add additional provisions to Chapter 4.70, or amend any existing provisions of Chapter 4.70, as they may already relate to this ordinance in any manner which does not result in an increase in the tax imposed herein, without further voter approval. If the Board of Supervisors repeals this ordinance or any provision of Chapter 4.70, it may subsequently reenact it without voter approval, as long as the re-enacted ordinance or section does not result in an increase in the tax imposed herein.

(Ord. 2026-0017 § 1, 2026.)

No injunction or writ of mandate or other legal or equitable process shall issue in any suit, action, or proceeding in any court against the State or the County, or against any officer of the State or the County, to prevent or enjoin the collection under this ordinance, or Part 1.6 of Division 2 of the Revenue and Taxation Code, of any tax or any amount of tax required to be collected.

(Ord. 2026-0017 § 1, 2026.)

A.

The Board of Supervisors shall establish a citizens' oversight committee advisory to the Board of Supervisors to provide transparency and ensure fiscal accountability of the retail transactions and use tax. The committee shall review the receipt and expenditure of the revenue from the transactions and use tax, including the County's annual independent audit. This advisory committee shall make recommendations to the Board on how to allocate the County's general fund revenue generated by the retail transactions and use tax. The committee's review shall be completed in conjunction with the County's budget process. The committee shall produce an annual oral or written report on its review, which shall be considered by the Board at a public meeting. Any final written report shall be a public record. To preserve the integrity and independence of the oversight process, the committee's responsibilities shall not include decision-making on spending priorities, financing plans or tax rate projections or assumptions and the committee shall have no authority to direct, nor shall it direct, County staff or officials.

B.

The Board of Supervisors shall appoint nine (9) members to the citizens' oversight committee with special consideration given to organizational representatives most impacted by H.R. 1. Committee members must either reside in or work in Los Angeles County. Citizens' oversight committee members shall serve a three-year term and are eligible to be reappointed by the Board of Supervisors, at their discretion.

C.

For so long as any proceeds of the retail transactions and use tax remain unexpended, the Auditor-Controller shall cause a report to be prepared by an independent auditor and filed with the Board of Supervisors no later than March 31 of each year, stating: (i) the amount of retail transactions and use tax proceeds collected and expended in the prior year; and (ii) the status of any projects or description of any services or programs funded from proceeds of the retail transactions and use tax.

(Ord. 2026-0017 § 1, 2026.)

In order to ensure public fiscal accountability, the County shall provide a public report summarizing all expenditures of funds raised pursuant to the retail transactions and use tax on an annual basis and shall subject the funds to independent audit/oversight by the citizens' oversight committee created pursuant to this ordinance or in a manner otherwise directed by the Board of Supervisors.

(Ord. 2026-0017 § 1, 2026.)

If any provision of this ordinance or the application thereof to any person or circumstance is held invalid, the remainder of the ordinance and the application of such provision to other persons or circumstances shall not be affected thereby.

(Ord. 2026-0017 § 1, 2026.)

This ordinance relates to the levying and collecting of the County's retail transactions and use tax and shall be considered as adopted upon the date the vote is declared by the Board of Supervisors, and shall go into effect 10 days after that date.

(Ord. 2026-0017 § 1, 2026.)

The Chair of the Board of Supervisors is authorized to attest to the adoption of this ordinance by the voters of the County.

(Ord. 2026-0017 § 1, 2026.)

The authority to levy the tax imposed by this ordinance shall terminate on October 1, 2031.

(Ord. 2026-0017 § 1, 2026.)