Parcel Tax in California 

A parcel tax is different than a traditional ad valorem property tax (a tax levied as a percentage of value), in that it is imposed by local government on a per-parcel basis. Local governments that may impose parcel taxes include cities, counties and special districts, such as schools, hospitals and public safety districts.

State law authorizes local governments to impose parcel taxes, as long as the tax is not based on the value of a property. Additionally, parcel taxes must be approved by a two-thirds vote of the electorate.

While there is no consistent definition, theBoard of Equalization defines a parcel as “an area of land in one ownership and one general use.” For tax purposes, a “parcel” is a property, or part of a property, that is entirely located within the invisible boundaries of a local government (this is known as a tax rate area). These invisible boundaries may divide a taxpayer’s property, thus creating multiple parcels out of a single property.

With the impact of Prop 13 in California since its inception in 1978, parcel taxes are a way to assess property owners they would otherwise not pay for since Prop 13 caps their tax contributions. In other words, parcel taxes are one way around Prop 13.

©SFRE 2016

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