Beverly Hills Could Raise Sales Taxes Conditionally

BEVERLY HILLS, CA — This November, Beverly Hills voters will decide whether to increase city sales tax to 10.25 percent, or a ¾ of a cent higher than the current rate.

The city’s current tax rate is 9.5 percent, the base rate for Los Angeles County. The ballot would raise it to the maximum amount allowed. Per the current arrangement, 8.5 percent of that money goes to the state, Los Angeles County, and other projects, while just one percent is returned to Beverly Hills. If voters approve the increase, the city would be able to keep the entire increase for its own coffers.

Unless a sales tax initiative is passed by voters for Los Angeles County or a special district, county agencies could take money that would otherwise go to Beverly Hills.

At a July 14 Council Study Session, Policy and Management Analyst Cynthia Owens forecast a $15.9 million revenue increase for the upcoming fiscal year if the measure passes, with $37.6 million in total. Owens called the potential ballot measure a “safety protection measure” that would allow the city to keep sales tax revenues for its own purposes, rather than giving it away to external entities.

While all five councilmembers directed staff to prepare the measure for the November ballot, they all expressed regret about tax increases during a pandemic. Still, they see it as necessary to protect the city’s money.

“Only the people who don’t take this protective measure will be bearing the burden for others,” said Vice Mayor Bob Wunderlich, who called the move “unfortunate.”

Owens noted that 31 of the 88 cities in Los Angeles County have approved sales tax rates above 9.5 percent, and 25 percent of those cities reached the maximum amount of 10.25 percent.

The Council is expected to vote on ballot measure language later this month.