City Clerk's Ruling

Section 21.15 (h) of the Los Angeles Municipal Code gives the Director of Finance the authority to adopt and promulgate rules and regulations pertaining to the collection of the Los Angeles Business Tax and the enforcement of the provisions of the Business Tax Ordinance (Article 1, Chapter 2 of the Los Angeles Municipal Code). The following is general information that applies to specific activities. City Clerk Rulings Nos. 1, 4, 5, 6 and 12 have been repealed. Please click on the link below for all City Clerks Rulings.

City Clerks Rulings

Important City Clerks Rulings


City Clerk's Ruling No. 13 (Persons selling goods, wares and merchandise in Los Angeles, with no fixed placed of business in Los Angeles)

Business Tax Classification Reference:
Sections 21.42 (LGR1) and 21.44 (LGR2) of the Los Angeles Municipal Code:

A person who does not own, lease, occupy or otherwise maintain within the City of Los Angeles a place or premises upon which or from which such person engages in business, shall nevertheless be deemed to be engaged in business within the City of Los Angeles when, through the physical presence of such person, such person's employees, such person's agents, or such person's equipment, such person carries on activities within the City of Los Angeles which are designed to solicit, promote, stimulate, or otherwise encourage the sale of goods, wares, or merchandise.

The measure of tax for such person shall be:

  1. 35% of those gross receipts from all sales to customers located within the City of Los Angeles, where delivery or shipment is made to points within the City by vehicles operated by the taxpayer.
  2. 30% of those gross receipts from all sales to customers located within the City of Los Angeles where delivery or shipment is made to points within the City by means other than vehicles operated by the taxpayer regardless of the f.o.b. point or other conditions of sale.
  3. 30% of those gross receipts from all sales to customers located within the City of Los Angeles where delivery or shipment is made to points outside the City.

City Clerk's Ruling No.14 (Person's selling goods, wares and merchandise, who have a fixed place of business in Los Angeles)

Business Tax Classification Reference:
Sections 21.42 (LGR1) and 21.44 (LGR2) of the Los Angeles Municipal Code

A person who owns, leases, occupies or otherwise maintains within the City a place or premises upon which, or from which the person engages in the business of selling goods, wares, and merchandise in the City and whose gross receipts from such sales are attributable to business activities carried on within the City and activities carried on outside the City, may apportion such gross receipts and include in the measure of tax those gross receipts directly attributable to activities carried on within the City.

In making a calculation of gross receipts to be reported as the measure of tax, the person may deduct from 100% of gross receipts the percentage of gross receipts deemed to be directly attributable to selling activities carried on by such person outside the City of Los Angeles. For the purposes of this calculation, the person may deduct, to the extent appropriate, but in no case in an amount greater than, the following percentages of those sales, or particular categories of sales, on which the corresponding elements of the selling process are performed at a place or location outside the City:

  1. Up to 30% for the location where the sale is negotiated or solicited by the taxpayer, through the physical presence of the taxpayer or the taxpayer's employees.
  2. Up to 20% for the sales office which serves as the base of operations for sales activities, or if there is no sales office which serves as a base of operations, the office from which the sales activities are directed or controlled.
  3. Up to 10% for the location where orders or contracts are accepted or approved. Such acceptance or approval shall be deemed to take place at the location of the office specified, in item 2 above, unless there is clear and conclusive evidence that a binding acceptance or approval occurs elsewhere.
  4. Up to 20% for any facility, operated by the taxpayer, where the goods, wares or merchandise are stored immediately prior to shipment or delivery.
  5. Up to 5% for the location, which gives the order for, or arranges for, the shipment or delivery of articles sold.
  6. Up to 5% for the place where billing procedures are performed.
  7. Up to 5% for the place where the collecting of receipts is performed.
  8. Up to 5% for the place to which merchandise is delivered by vehicles operated by the taxpayer.

City Clerk's Ruling No. 15 (Gross receipts attributable to business engaged in within the city)

Business Tax Classification Reference:
Section 21.49

It is the ruling of the City Clerk that any person engaging in a business subject to tax under Section 21.49 of the L.A.M.C shall include in the measure of tax the total gross receipts from work performed within the City; and in addition thereto, if such person owns, leases, occupies or otherwise maintains within the City a place or premises from which such person engages in business activities outside the City, such person shall include a portion of the gross receipts from work performed outside the City in the measure of tax. In the absence of substantial information, 20% of gross receipts from work performed outside the City shall be deemed to be that portion subject to tax as attributable to business engaged in within the City.

Where there are no measurable gross receipts directly attributable to operations carried on from a place of business within the City, it is the ruling of the Office of Finance that such operations shall be deemed to produce gross receipts in an amount at least equal to the cost of maintaining such operations. Such cost of operations shall include, but not be limited to, rent and/or depreciation, salaries and wages, fixed charges and other expenses.

For additional information or a copy of any City Clerk's Ruling, please go here:

Tax Ordinance