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Voters throughout Los Angeles County have been asked repeatedly to approve higher local sales taxes. The pitch is familiar and often compelling: The money will protect critical services that residents depend on, such as healthcare and fire services. And voters have frequently agreed. Earlier this year, they approved a 0.5% county-wide sales tax increase and additional hikes in 10 cities, including Calabasas, Gardena and San Marino. This November, five more cities, including Los Angeles, are requesting sales tax increases or extensions of previously approved higher rates.
It is understandable that local governments want to raise these rates to fund their budgets.
But rising sales taxes also contribute to the region’s extraordinarily high costs. With affordability now the top issue on Californians’ minds, it is worth asking how much residents are already paying and whether there are limits to what they will accept.
A new report from the Rose Institute of State and Local Government finds that sales tax rates have climbed across Southern California over the past decade, with L.A. County far outpacing Orange, Riverside and San Bernardino counties.
In L.A. County, the average sales tax rate rose from 9.09% in 2016 to 10.83% today. The lowest rate of any city in L.A. County is now a full percentage point higher than the highest rate in any neighboring county. Two cities in L.A. County, Lancaster and Palmdale, have reached 11.75% — the highest in the state. On Nov. 3, San Gabriel could set a new record, as voters decide on a one-point increase that would raise the city’s rate to 12%.
Sales taxes are assessed on retail purchases of goods such as clothing, electronics, furniture and cars. Sales of groceries, prescription medication, housing and many services are not taxed. The statewide base rate is 7.25%, with anything above that base needing to be a voter-approved “district” tax. When counties and cities ask voters to approve an increase, the jurisdiction that levies it keeps all the revenue.
In L.A. County, the rise in sales taxes has largely been driven by countywide measures. Over the last 10 years alone, voters approved three of these measures totaling 1.5 points: Measure M in 2016 (transportation), Measure A in 2024 (homelessness) and Measure ER in 2026 (healthcare). These measures, combined with previous ones dating to 1980, brought the minimum rate in the county to 10.25%. Some cities have stacked sales tax increases on top of that amount.
State law generally limits the combined district taxes in any one jurisdiction to 2%. In theory, this creates a statewide sales tax cap of 9.25%, but the Legislature can waive the limit, and it has done so repeatedly for the state’s largest county. Because these waivers are routinely granted, especially over the last 10 years, the 2% limit does not truly operate as a ceiling.
One reason voters regularly approve these measures may be that they see the purpose of a tax, but not the total price. For instance, the ballot question for Measure ER in June presented the issue as a 0.5% general sales tax for five years to “reduce the risk of closing the County’s four public hospitals and numerous clinics.” The measure did not explain to voters that the county’s base sales tax rate was 9.75% or that Measure ER would increase it to 10.25%.
This omission obscures the fact that rising sales taxes meaningfully contribute to the high cost of living in L.A. County. The effects are easiest to see in large purchases. For example, a Palmdale resident who buys a $50,000 car would pay a $5,875 sales tax pursuant to the city’s 11.75% rate. But a resident of another Southern California city such as Anaheim, which has a 7.75% sales tax (tied for the region’s lowest rate), would pay only a $3,875 sales tax on the same car. Living across the county line would yield a $2,000 savings in the final purchase price.
Similar gaps apply to other taxable purchases. Residents from different parts of Southern California can pay very different sales taxes on everyday purchases, depending on where they live and shop. But because rates often climb a fraction of a point at a time, many residents in high-tax cities may not realize how much more they pay than shoppers just across a city or county line.
So far, voters have not imposed a ceiling on the rise of sales taxes in L.A. County. This November’s election results will test that trend. Five sales tax measures will be on L.A. County ballots. Notably, this includes Measure FD, Los Angeles’ half-cent increase to 10.75%. Perhaps voters will approve this and other sales tax hikes. Or maybe their appetite for new taxes will wane as affordability and cost of living take priority over the services these measures fund.
Kenneth P. Miller is professor of Government and director of the Rose Institute of State and Local Government at Claremont McKenna College. Keith Maben is a student researcher at the Rose Institute.
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Ideas expressed in the piece
- The article argues that repeated local sales-tax increases are adding to Los Angeles County’s high cost of living, and that voters may not see the cumulative rate when each ballot measure is presented as a small increase for a specific purpose.
- It contends that the state’s nominal limit on local district taxes does not function as a meaningful ceiling because the Legislature has repeatedly granted waivers for Los Angeles County.
- The piece illustrates the uneven burden with the cost of a taxable purchase: a $50,000 car incurs substantially more sales tax in Palmdale than in lower-tax Anaheim. It says the November vote on five local measures, including Los Angeles’ proposed Measure FD, will test whether voters are still willing to approve increases.
Different views on the topic
- Supporters of the tax measures argue that new revenue is needed to preserve essential services. County leaders and healthcare advocates backed Measure ER as a way to offset funding losses and help keep hospitals, clinics and other health services operating; the measure is scheduled to expire after five years.[4][5]
- In Los Angeles, firefighters and other Measure FD supporters say the Fire Department is understaffed and under-resourced, and that the proposed half-cent increase could fund more firefighters and paramedics, equipment and fire stations, while improving emergency response.[1][2]
- Critics of further increases also raise concerns about the burden on residents: the California Contract Cities Assn. argued that the Measure ER tax could disproportionately affect the very residents the county aims to protect.[5] Opponents of Measure FD likewise point to the city’s already high rate and the succession of recent sales-tax increases.[1][3]
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