Measure U Gross Receipts Business License Tax

Revenue Ballot Measure
City Council placed a measure on the November 3, 2020 ballot that was approved by the voters, which changes the Business License Tax calculation methodology to be based on gross receipts in the City of Richmond instead of the number of employees. The new model would calculate the business license tax based on the amount of gross receipts (total amount of money received in connection with any sale) in Richmond by the business and then charging a specific percentage based on the type of business and the amount of revenue generated. The tax to businesses is based on a range from 0.075% to 1.395% of gross receipts.

Previously, the business license tax in most cases was based on the number of employees. The base rate was $234.10 per year and increases per each employee a business has working in Richmond (the first 25 employees are charged at $46.80 per employee, and employees above 25 are charged at a rate of $40.10 per employee). The cannabis industry (at 5%) and movie theaters (at 0.3% for revenues over $20,000) are currently based on gross receipts.

Implementation Date
Council approved a change to the implementation date from July 1, 2021 to January 1, 2022 in accordance with Section 7.04.680(B). Staff has met on several occasions with a coalition of Richmond businesses and presented at both Richmond Neighborhood Coordinating Council (RNCC) and Economic Development Commission (EDC).

In meeting with the business coalition that included representatives from West Contra Costa County Council of Business and Industry and Richmond Chamber of Commerce, staff has gathered a listing of concerns and uncertainties around definitions of certain terms, and clarification around implementation of the ordinance. Please reference the Frequently Asked Questions (FAQ) section for more information.

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Agenda Report

Attachment 1 - Resolution - UPDATED
Attachment 2 - Ordinance - UPDATED
Special Meeting Presentation ~ August 5, 2020
Community Meeting
Council Meeting
Measure U Business Tax Calculator
Measure U Business Tax Frequently Asked Questions (FAQs)
Measure U Program Implementation - Business Information Sessions
Principal Business or Professional Activity Codes
Richmond Measure U Business Information Meetings ~ October 19, 2021

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