Laguna Beach is a small, affluent coastal city in Orange County known for its beaches, tourism, art galleries, restaurants, boutique retail, and strong creative economy. Its economy is heavily influenced by visitors, while also serving a year-round residential population. The city places a high value on preserving its distinctive architecture, historic character, coastal environment, and village-scale commercial areas. This creates a desirable business environment, but it can also make expansion, redevelopment, parking, signage, and permitting more complicated than in less regulated communities.
All businesses operating in Laguna Beach are required to obtain a city business license. The City's current fee schedule, updated February 10, 2026, establishes a $60 base business-license fee, plus a $20 new-license/change fee and a $4 state-mandated SB 1186 fee. Commercial businesses also pay a $414 use-and-occupancy fee. Home-based businesses have a substantially higher $180 home-occupation fee. (Laguna Beach City)
The business tax itself is generally based on gross receipts:
Retail, wholesale, manufacturing and fabrication: $0.44 per $1,000 of gross receipts, up to $1,650.
Personal services, recreation/entertainment, personal-property rental and accommodations: $0.88 per $1,000, up to $1,650.
Professional services: $1.10 per $1,000, up to $1,650.
Certain businesses, including contractors, real-estate professionals and transportation businesses, have separate flat fees. (Laguna Beach City)
The City requires businesses to have an actual physical address; it does not issue licenses to businesses using only a P.O. Box or virtual mailbox. Businesses must also establish zoning compliance before applying for the license, and some uses require additional approvals such as a Conditional Use Permit. (Laguna Beach City)
Downtown Laguna Beach is the city's primary commercial and cultural center. It encompasses much of Forest Avenue, South Coast Highway and surrounding streets and is characterized by galleries, restaurants, boutiques, hotels, professional services and visitor-oriented businesses. The City's Downtown Specific Plan deliberately seeks to maintain a balance between resident-serving and visitor-serving businesses. (Laguna Beach City)
The HIP District—the Historic/Interesting Places district south of downtown—is a more eclectic commercial area with boutiques, restaurants, cafes, art galleries and specialty businesses. City planning documents describe it as having attracted more local, specialty and creative businesses partly because rents have historically been lower than downtown. (Laguna Beach City)
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