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Long Beach has filed a lawsuit against the California Department of Tax and Fee Administration (CDTFA) after the agency blocked the city’s attempt to raise its sales tax to 10.75% without voter approval. Meanwhile, the Long Beach Reform Coalition (LBRC) is also suing the city, arguing the tax hike violates state law.
The City Council approved the quarter-cent increase, but CDTFA ruled that local tax hikes require voter authorization. As a result, the agency confirmed Long Beach’s rate would only rise to 10.5% on April 1, reflecting a previously approved Los Angeles County Measure A increase, but not the city’s additional hike.
Despite the CDTFA’s rejection, Long Beach is suing to enforce the higher tax rate, claiming voter intent supports the increase. However, retailers and residents remain in limbo, uncertain about what rate to apply when the new tax takes effect. If upheld, Long Beach will have one of California’s highest sales tax rates.
LBRC Executive Director Ian Patton criticized the city’s legal battle, stating:
“Long Beach is fighting both its own residents and the State of California to push through an illegal tax increase.”
The ongoing legal disputes leave Long Beach’s tax policy in flux, with significant financial implications for businesses and consumers.
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