Mcguire’s bill aims to generate millions for local vital services

Senator Mike Mcguire’s bill that would create a new, innovative system for collecting and dispensing revenue from Transit Occupancy Taxes (TOT) for short-term vacation rentals has passed its first committee in the Senate.

In California, nearly every city and county levies TOT, and the revenue collected is typically used to support essential government services. Unlike with hotels and motels, local jurisdictions often have an incredibly difficult time collecting TOT on short-term vacation rentals because hosts are not always aware of the requirement to collect and remit these taxes, and local governments do not always know what properties are being used for short-term vacation rentals.

SB 555 will help cities and counties collect this untapped revenue by creating a statewide TOT collection program administered by the California Department of Tax and Fee Administration for local jurisdictions who choose to participate.

“Hundreds of cities and counties don’t collect bed taxes from short-term vacation rentals and this is a simple statewide solution that will collect and invest in vital services that will help California cities and counties thrive,” Mcguire said. “SB 555 will provide cities and counties the ability to opt-in to a statewide program to collect bed tax revenue from tourists, which will in turn be reinvested into fire and police services, local parks and libraries, and economic development projects.”