National City Business License Tax Reform
National City Council Votes Against November Ballot Measure to Reform Business License Tax
On Tuesday, August 4, the National City Council held a special hearing to consider placing a measure on the November ballot that would increase the Business License Tax for most businesses in the city, including rental housing providers. City staff presented two options to the Council, both of which would apply the highest proposed tax rate to rental properties.
SCRHA testified in opposition to the proposal, citing concerns that the measure would double—and in some cases triple—the rate for housing providers, a cost that would likely be passed on to renters. SCRHA also noted that rental housing stakeholders were not directly engaged despite the significant amount of rental housing in the community. The broader business community, ranging from large companies to small independent businesses, also turned out against the measure. The consensus from the business community, including SCRHA, was that stakeholders want to help reform the outdated Business License Tax framework, but the proposal presented was rushed and needed more thoughtful input and discussion from all affected parties.
After hours of testimony and discussion, a majority of the Council voted against placing the measure on the November ballot. Instead, the Council directed staff to continue studying the proposal, expand public education and outreach, and create an advisory group.