Santa Monica is a highly desirable coastal city in western Los Angeles County with a diverse economy built around tourism, retail, professional services, technology, media, entertainment, healthcare and creative industries. Its proximity to Los Angeles, the Pacific Ocean, major freeways and the Metro E Line makes it an attractive location for businesses, although relatively high real-estate costs can be a significant consideration.
Santa Monica requires essentially every person or entity conducting business in the city to obtain an annual business license and pay applicable taxes, fees and assessments. The principal business license tax is based on gross receipts attributable to business conducted in Santa Monica.
For most businesses, the basic structure is $75 on the first $60,000 of gross receipts, followed by a tax based on the business classification. Current rates include:
Retail: $1.15 per $1,000 of receipts above $60,000 for retailers with less than $5 million in worldwide gross receipts; $1.25 per $1,000 above that threshold. Manufacturing/wholesale: $1.25 per $1,000. Services, agents and brokers: $3.00 per $1,000. Professional occupations: $5.00 per $1,000. Corporate/administrative headquarters: $2.25 per $1,000 for FY 2026–27. Certain activities, such as delivery businesses, have flat fees.Importantly for smaller companies, Santa Monica provides a business-license-tax exemption for businesses with less than $103,000 in worldwide gross receipts, although the business must still maintain its license and pay applicable fees and assessments.
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