1.4.5 General Taxes

General taxes are taxes levied by local governmental entities for general revenue purposes. Although it may be possible for an advisory measure to indicate voter desires with respect to how tax proceeds should be spent, a “general tax” may not be imposed for a specific purpose or specific purposes. Only general purpose governmental entities (i.e., cities and counties) may levy general taxes and California Constitution, Article XIIIA precludes the imposition of new ad valorem real property taxes as “general taxes.” General taxes are addressed in Article XIIIC of the California Constitution. Common types of general taxes include the following:

Utility user taxes
Transient occupancy taxes
Add-on sales taxes (See Section 3.3.3, Sales Tax Revenue Bonds)
Business license taxes (including a “soda tax” and rental car taxes)
Admissions or event entrance taxes

APPROVAL REQUIREMENTS FOR NEW, EXTENDED OR INCREASED GENERAL TAXES – The imposition, extension, or increase of any general tax must be approved by the governing board of the taxing entity or placed on the ballot by an initiative petition and must be approved by voters. A general tax is not “increased” if imposed at a rate not higher than previously approved.

CITY COUNCIL OR COUNTY BOARD OF SUPERVISORS APPROVAL REQUIREMENT – Two-thirds vote

VOTER APPROVAL REQUIREMENT – Majority

DEBT FINANCING IMPACT – Like a local governmental entity’s share of general property tax revenues, general taxes are a source of revenue available for general purposes and are a source of payment for general fund obligations such as leases and TRANs.