Berkeley Rental Housing Coalition
Increase in Business License Tax for 2017 (and beyond) Rental Income
In November 2016, Berkeley voters elected to increase the annual business license tax from $10.80 per every $1,000 of gross rental income to $26.60 for every $1,000. This increase in the tax is intended to go to the General Fund which will then (possibly) be directed to the Affordable Housing Trust Fund. The Housing Advisory Commission is to make recommendation to the City Council as to how the money should be spent.
A key change in the Business License Tax structure is one that moves the calculation from per parcel to cumulative ownership. Previously, the BLT was levied on owners of parcels with 3 or greater units on it. The new, stepped up tax applies to those whose ownership is of "5 or greater units of rental housing in Berkeley."
As the watchdog for rental housing providers in Berkeley, we have many questions about how this ownership will be calculated. We believe this could have unintended consequences and sweep up owners of rental units into a new, higher tax rate that were previously not subject to tax at all.
Check back here regularly for updates on our communications with the city and any information the city imparts about this new calculation.