Bill > AB1324

This bill allows the City of El Cerrito to impose a local transactions and use tax, which is a sales tax collected by retailers and remitted to the state, but then distributed to local governments. Specifically, the City of El Cerrito can enact a tax of up to 0.5 percent for general purposes, even if this would cause the total combined sales tax rate in the area to exceed the limit set by existing state law (Section 7251.1 of the Revenue and Taxation Code). For this to happen, the city must pass an ordinance proposing the tax, and this ordinance must be approved by El Cerrito voters, as required by the California Constitution. The tax must also follow the general rules for transactions and use taxes, except for the rate limit, and it can be imposed starting January 1, 2015. However, if voters haven't approved the tax by January 1, 2022, this new law allowing the tax will be repealed. The bill states that this is a special law because El Cerrito faces unique financial and public service challenges.