Tax Information

Cost of Doing Business in Los Angeles County

While it is a major urban area, Los Angeles County is competitive cost-wise for the scope of opportunities in the region. And while the cost of doing business is competitive, the actual business costs vary depending on the following factors:

  • Type of Business
  • Size of Business
  • Number of employees
  • Utility usage
  • City (there are 88 cities in the County of Los Angeles, each one with different tax structures)

Permits

The permit process varies depending on the type of business and city where business will be located. CalGOLD Business Permit Made Simple gives some indication of the types of business permits needed by business type and location.

Business Taxes

Business taxes includes business taxes and fees and payroll taxes affecting businesses that typically occupy office, retail, and industrial space, as well as charges for nonresidential and residential landlords. The amount or percentage of business taxes vary depending again on the type of business, size of business, number of employees, utility usage, and city where located (there are 88 cities in the County of Los Angeles).

Business taxes fall under one of these categories, depending on the city.

  • Fees
  • Gross Receipts
  • Employee
  • Payroll
  • Flat Rate/ Other

There are eight (8) general business categories:

  1. General Office
  2. Professional Office
  3. Retail
  4. Wholesale
  5. Manufacturing
  6. Personal Service
  7. Commercial Property
  8. Residential Property

Utility User, Property, and Other Taxes (variations are by city)

  • Utility taxes for electric, telephone, cellular, gas, and water billings vary from 0% to 12.5%
  • Ad Valorem Property Tax rates vary from: 1.01% to 1.8%
  • Transient occupancy tax (surcharge on hotel room rates) vary from 0% to 14%
  • Parking tax rates vary from 0% to 10%
  • County Sales Tax 8.25%
  • Documentary (or real property) transfer tax per $1,000 of transaction value: $1.10 to $5.60
  • Development Impact/ Exaction Fees: Entitlement fees vary and may be assessed against certain development projects

For more information on specific business taxes by respective city, please contact the LAEDC’s Business Development Department at 213-236-4838 or see SCAG’s full list.