For AI agents: read the machine-readable documentation index at /llms.txt or the single-file full reference at /llms-full.txt.
Form a Business

UTILITY USERS TAX

SF-BUSTAX art. 10
in effect

SF Business and Tax Regulations Code § 701 ADDITIONAL DEFINITIONS.

SF Business and Tax Regulations Code § 703 TELEPHONE USERS TAX.

SEC. 703. TELEPHONE USERS TAX. (a) There is hereby imposed a tax upon every person, other than a telephone communications service supplier, who uses telephone communications service in the City, including intrastate, interstate, and international telephone communications service, to the extent permitted by Federal and State law. The telephone users tax shall apply to all charges for telephone communications service within the City's tax jurisdiction, such as charges billed to a telephone account having a situs in the City as permitted by the Mobile Telecommunications Sourcing Act of 2000, 4 U.S.C. § 116 et seq. There is a rebuttable presumption that telephone communications service billed to a billing address or provided to a service address in the City is used, in whole or in part, within the City's boundaries and that such service is subject to taxation under this Article. There is also a rebuttable presumption that a telephone communications service sold within the City that is not billed to a billing address or provided to a primary physical location in the City is used, in whole or in part, within the City's boundaries and that such service is subject to taxation under this Article. (b) As used in this Section, the term "charges" shall include without limitation: charges for activation, connection, reconnection, termination, movement, or change of telephone communications service; late payment fees; access and line charges, whether or not imposition of such charges is mandated or authorized by a regulatory agency; universal service charges and any other charges designed to assist in expanding access to telephone communications service; and regulatory, administrative and other cost recovery charges. The term "charges" shall include the value of any other services, credits, property of every kind or nature, or other consideration provided by the service user in exchange for telephone communications service. (c) The tax imposed by this Section shall be collected from the service user by the telephone communications service supplier. (d) The following shall continue to be exempt from the tax imposed by this Section: (1) Residential telephone communications service; (2) Any person or entity that is exempt from the tax imposed by this Section under Article 6 or its successor; (3) Service paid for by inserting coins in coin-operated telephones available to the public with respect to local telephone service, or with respect to long distance telephone service if the charge for such long distance telephone service is less than 25 cents; except that where such coin-operated telephone service is furnished for a guaranteed amount, the amounts paid under such guarantee plus any fixed monthly or other periodic charge shall be subject to the tax. (4) News services. No tax shall be imposed under this Section, except with respect to local telephone service, on any payment received from any person for services used in the collection of news for the public press; or a news ticket service furnishing a general news service similar to that of the public press, or radio broadcasting, or in the dissemination of news through the public press, or a news ticker service furnishing a general news service similar to that of the public press, or by means of radio broadcasting, if the charge for that service is billed in writing to that person. (5) International, etc., organizations. No tax shall be imposed under this Section on any payment received for services furnished to a public international organization in which the United States participates pursuant to treaty or Act of Congress, or to the American National Red Cross. (6) Servicemen in combat zone. No tax shall be imposed under this Section on any payment received for any roll telephone service, which originates within a combat zone, as defined in Section 112 of Title 26 of the United States Code, from a member of the Armed Forces of the United States performing service in the combat zone, as determined under Section 112 of Title 26 of the United States Code. (7) Items otherwise taxed. Only one payment of tax under this Section shall be required with respect to the tax on any service, provided, however, that a person claiming exemption under this Section shall bear the burden to prove the City actually received the earlier payment of tax on that service. (8) Common carriers and telecommunications companies. No tax shall be imposed under this Section on the amount paid for any telephone communications service to the extent that the amount so paid is for use by a common carrier, telephone or telegraph company, or radio broadcasting station or not work in the conduct of its business. (9) Installation charges. No tax shall be imposed under this Section on any amount paid for the installation of any instrument, wire, pole, switchboard, apparatus, or equipment as is properly attributable to the installation. (10) Nonprofit hospitals. No tax shall be imposed under this Section on any amount paid by a nonprofit hospital for services furnished to that organization. For purposes of this exemption, the term "nonprofit hospital" means a hospital referred to in Section 170(b)(1)(A)(iii) of Title 26 of the United States Code, which is exempt from Federal income tax under Section 501(a) of Title 26 of the United States Code. (11) State and local governments. No tax shall be imposed under this Section upon any payment received for services or facilities furnished to the government of any State, or any of its political subdivisions, or the District of Columbia. (12) Nonprofit educational organizations. No tax shall be imposed under this Section on any amount paid by a nonprofit educational organization for services or facilities furnished to that organization. For purposes of this exemption the term "nonprofit educational organization" means an educational organization described in Section 170(b)(1)(A)(ii) of Title 26 of the United States Code, which is exempt from Federal income tax under Section 501(a) of Title 26 of the United States Code. The term also includes a school operated as an activity of an organization described in Section 501(c)(3) of Title 26 of the United States Code, which is exempt from Federal income tax under Section 501(a) of Title 26 of the United States Code, if that school normally maintains a regular facility and curriculum and normally has a regularly enrolled body of pupils or students in attendance at the place where its educational activities are regularly carried on. (e) To prevent actual, multiple taxation of any telephone communications service subject to tax under this Section, any service user, upon proof that the service user owed and has paid a tax in another taxing jurisdiction on the telephone communications service, shall be allowed a credit against the tax imposed by this Section to the extent of the tax properly due and paid in the other taxing jurisdiction. However, no credit may be allowed for any tax paid to another taxing jurisdiction to the extent that the telephone communications service may not legally be made the subject of taxation by the other taxing jurisdiction, nor shall the amount of credit exceed the tax owed to the City under this Section. (f) If a non-taxable service and a taxable service are billed together under a single charge, the entire charge shall be deemed taxable unless the telephone communications service supplier or taxpayer reasonably identifies actual charges for services not subject to the tax. The telephone communications service supplier or taxpayer seeking a reduction has the burden of proving the proper valuation and apportionment of taxable and non-taxable charges based upon books and records that are kept in the regular course of business and in a manner consistent with generally accepted accounting principles. (Amended by 529-82, App. 11/5/82; Ord. 138-87, App. 4/27/87; Ord. 262-93, App. 8/10/93; Ord. 21-98, App. 1/16/98; Ord. 224-06, File No. 061142, Effective without the signature of the Mayor; Amended by Proposition O, § 4, 11/4/2008)

SF Business and Tax Regulations Code § 704 ELECTRICITY USERS TAX.

SEC. 704. ELECTRICITY USERS TAX. (a) There is hereby imposed a tax upon every person, other than an electrical corporation or a gas corporation, using electrical energy in the City and County. The tax imposed by this Section shall be on the charges made for such energy and shall be paid by the person paying for such energy. "Charges" as used in this Section shall include charges made for (1) metered energy, and (2) minimum charges for service, including customer charges, service charges, demand charges, standby charges and annual and monthly charges. (b) As used in this Section, the term "using electrical energy" shall not be construed to mean the storage of such energy by a person in a battery owned or possessed by him for use in an automobile or other machinery or device apart from the premises upon which the energy was received; provided however, that the term shall include the receiving of such energy for the purpose of using it in the charging of batteries. (c) As used in this Section, the words "using electrical energy" shall not be construed to mean the receiving of such energy by an electrical corporation or a governmental agency at a point within the City and County for resale, or electrical energy used by a water corporation to pump water. (d) For purposes of the exemption from this tax provided in Section 707.1, the words "residential customers" shall mean and include: (1) Every person who is charged for electricity based upon residential and/or domestic rate schedules filed with the California Public Utilities Commission by an electrical corporation; and (2) Any residential hotel where at least 50 percent of the guest units in the residential hotel are leased for a minimum period of one month and are occupied for nine months of the year. (e) The tax imposed by this Section shall be collected from the service user by the person supplying such electrical energy. The amount of tax collected in one month shall be remitted to the Tax Collector on or before the last day of the following month. (Amended by Ord. 81-84, App. 2/23/84; Ord. 138-87, App. 4/27/87; Ord. 21-98, App. 1/16/98)

SF Business and Tax Regulations Code § 705 GAS USERS TAX.

SEC. 705. GAS USERS TAX. (a) There is hereby imposed a tax upon every person, other than a gas corporation or an electrical corporation, using gas which is delivered through mains or pipes in the City and County by a gas corporation. The tax imposed by this Section shall be on the charges made for such gas, including minimum charges for services, and shall be paid by the person paying for such gas. (b) As used in this Section, the word "charges" shall not include charges made for gas used in the generation of electrical energy by a public utility or a governmental agency. (c) As used in this Section, the words "using gas" shall not be construed to mean the receiving of such gas by a gas corporation or governmental agency at a point within the City and County for resale and delivery through pipes and mains or gas used by a water corporation to pump water or gas used by a steam corporation to generate steam. (d) For purposes of the exemption from this tax provided in Section 707.1, the words "residential customers" shall mean and include: (1) Every person who is charged for gas based upon residential and/or domestic rate schedules filed with the California Public Utilities Commission by a gas corporation; and (2) Any residential hotel where at least 50 percent of the guest units in the residential hotel are leased for a minimum period of one month and are occupied for nine months of the year. (e) The tax imposed in this Section shall be collected from the service user by the person selling the gas. The amount collected in one month shall be remitted to the Tax Collector on or before the last day of the following month. (Amended by Ord. 81-84, App. 2/28/84; Ord. 138-87, App. 4/27/87; Ord. 324-93, App. 10/15/93; Ord. 21-98, App. 1/16/98)

SF Business and Tax Regulations Code § 706 WATER USERS TAX.

SEC. 706. WATER USERS TAX. (a) There is hereby imposed a tax upon every person, other than a water corporation, using water which is delivered through mains or pipes in the City and County. The tax imposed by this Section shall be on the charges made for such water including minimum charges for services, and shall be paid by the person paying for such water. For purposes of the exemption from this tax provided in Section 707.1, a residential customer shall include any residential hotel where at least 50 percent of the guest units in the residential hotel are leased for a minimum period of one month and are occupied for nine months of the year. (b) The tax imposed by this Section shall be collected from the service user by the City and County or other person supplying the water. The amount collected in one month shall be remitted to the Tax Collector on or before the last day of the following month. (Amended by Ord. 81-84, App. 2/23/84; Ord. 138-87, App. 4/27/87; Ord. 21-98, App. 1/16/98)

SF Business and Tax Regulations Code § 706.1 STEAM USERS TAX.

SEC. 706.1. STEAM USERS TAX. (a) There is hereby imposed a tax upon every person, other than a steam corporation, using steam heat which is delivered through mains or pipes in the City and County. The tax imposed by this Section shall be on the charges made for such steam heat, including minimum charges for services, and shall be paid by the person paying for such steam heat. For purposes of the exemption from this tax provided in Section 707.1, a "residential customer" shall include any residential hotel where at least 50 percent of the guest units in the residential hotel are leased for a minimum period of one month and are occupied for nine months of the year. (b) The tax imposed by this Section shall be collected from the service user by the City and County or other person supplying the steam heat. The amount collected in one month shall be remitted to the Tax Collector on or before the last day of the following month. (Amended by Ord. 81-84, App. 2/23/84; Ord. 138-87, App. 4/27/87; Ord. 21-98, App. 1/16/98)

SF Business and Tax Regulations Code § 707 ADDITIONAL EXEMPTIONS.

SEC. 707. ADDITIONAL EXEMPTIONS. All components of gas and electric bills calculated on the baseline rate, as defined in Section 739 of the California Public Utilities Code, as amended, shall be exempt from the utility users tax. An exemption shall also apply to any universal lifeline service rate established by State authorities for telephone service or any lifeline rate established by local authority for water service. (Amended by Ord. 578-85, App. 12/27/85; Ord. 21-98, App. 1/16/98)

SF Business and Tax Regulations Code § 707.1 UTILITY USERS TAX EXEMPTION.

SEC. 707.1. UTILITY USERS TAX EXEMPTION. (a) No tax shall be levied upon residential telephone communications service or upon the use in the City and County of San Francisco by residential customers of electrical energy or gas, water or steam which is delivered through mains or pipes or of any other utility service after June 30, 1988. (b) For the purposes of this Section, "residential customer" shall mean any customer paying for the utility service at a residential or domestic rate consistent with the rate schedule set by the California Public Utilities Commission or any other rate-making authority. (c) This Section was adopted by the voters of San Francisco at the November 3, 1987 election and may be amended only by the vote of the electorate. (Added by Proposition R, 11/3/87; Amended by Proposition O, § 4, 11/4/2008)

SF Business and Tax Regulations Code § 707.2 UTILITY USERS TAX RATES.

SF Business and Tax Regulations Code § 708 COLLECTION OF TAX.

SEC. 708. COLLECTION OF TAX. (a) Unless prohibited by the laws of the United States or the State of California, or exempted by the provisions of this Code every person using telephone communications services, electrical water gas or steam services in this City and County shall be required to pay the tax imposed in this Article and Article 10B to the service supplier along with the charges made for such services. This obligation is not satisfied until the tax has been paid to this City and County, except that a receipt indicating payment of the service charges from a service supplier maintaining a place of business in this City and County or from a supplier who is authorized by the Tax Collector to collect the tax shall be sufficient to relieve the service user from further liability for the tax to which the receipt refers. (b) Every service supplier maintaining a place of business in this City and County, and providing telephone communications services electrical, water gas or steam services to a service user, not exempted under this Code shall, at the time of collecting the charges made for such services from the service user, also collect the tax imposed by this Article and Article 10B from the service user and on demand shall give to the service user a receipt therefor. In all cases in which the tax is not collected by the service supplier, as aforesaid, the service supplier shall be liable to the Tax Collector of the City and County for the amount of the tax due on the amount of taxable service charges collected from the service user under the provisions of this Article and Article 10B, the same as though the tax were paid by the service user. In all cases of transactions upon credit or deferred payment, the payment of tax to the Tax Collector may be deferred in accordance therewith, and the service supplier shall be liable therefor at the time and to the extent that such credits are paid or deferred payments are made in accordance with the rate of tax owing on the amount thereof. The Tax Collector shall have the power to adopt rules and regulations prescribing methods and schedules for the collection and payment of the tax and such methods and schedules shall eliminate fractions of one cent. (c) The taxes imposed by this Article and Article 10B shall be collected, insofar as practicable, at the same time as and along with the collection of charges made in accordance with the regular billing practice of the service supplier. If the amount paid by a service user is less than the full amount of the charges and tax which has accrued for the billing period, a proportionate share of both the charges and the tax shall be deemed to have been paid. The duty to collect shall arise separately for each period for which a service supplier bills a service user. (d) The Tax Collector may issue administrative rulings identifying telephone communications services that are subject to the taxes imposed by Section 703 of this Article and Article 10B. Such rulings shall be consistent with legal requirements and shall not impose a new tax, revise an existing tax methodology, or increase an existing tax, except as allowed by California Government Code Section 53750(h)(2) and (3) or other law. To the extent that the Tax Collector determines that the taxes imposed under Section 703 or Article 10B shall not be collected in full for any period of time, such a determination falls within the Tax Collector's prosecutorial discretion to settle disputes. The Tax Collector's exercise of such forbearance under this Section does not constitute a change in taxing methodology for purposes of Government Code section 53750(h), and the City does not waive or abrogate its ability to impose the taxes imposed by Section 703 or Article 10B in full as a result of such determinations and may suspend such determinations and recommence enforcement of the taxes without additional voter approval. (e) A service supplier shall be obligated to collect and remit the tax imposed by Section 703 of this Article and Article 10B if it is "engaging in business within the City" as described in Article 6, Section 6.2-12. (Added by Ord. 287-70, App. 8/28/70; amended by Ord. 262-93, App. 8/10/93; Ord. 21-98, App. 1/16/98; Amended by Proposition O, § 4, 11/4/2008)

SF Business and Tax Regulations Code § 714 REFUNDS.

SEC. 714. REFUNDS. (a) Any tax, interest or penalty overpaid or paid more than once may be refunded pursuant to Section 6.15-1, Refunds, of the San Francisco Business and Tax Regulations Code. (Amended by Ord. 330-70, App. 10/8/70; Ord. 21-98, App. 1/16/98; Ord. 224-06, File No. 061142, Effective without the signature of the Mayor)

SF Business and Tax Regulations Code § 715 FAILURE TO PAY TAX; ADMINISTRATIVE REMEDY.

SEC. 715. FAILURE TO PAY TAX; ADMINISTRATIVE REMEDY. Notwithstanding any other provision of this Article, including the provisions of Section 711, whenever the Tax Collector determines that a service user has deliberately withheld the amount of the tax owed by him for the amounts remitted to a service supplier, or that a service user has failed to pay the amount of the tax for a period of four or more billing periods, or whenever the Tax Collector deems it in the best interest of the City and County, the Tax Collector shall relieve the service supplier of the obligation to collect taxes due under this ordinance from certain named services users for specified billing periods. The Tax Collector shall notify the service user that he has assumed responsibility to collect the taxes due for the stated periods and demand payment of such taxes. The notice shall be served on the service user by handing it to him personally or by deposit of the notice in the United States mail, postage prepaid thereon, addressed to the service user at the address to which billing was made by the service supplier, or, should the service user have changed his address, to his last known address. If a service user fails to remit the tax to the Tax Collector within 15 days from the date of the service of the notice upon him, which shall be the date of mailing if service is not accomplished in person, a penalty of 25 percent of the amount of the tax set forth in the notice shall be imposed, but not less than $5.00. The penalty shall become a part of the tax herein required to be paid. This penalty shall be in addition to, and not exclusive of, any other penalties provided in this Code. (Added by Ord. 287-70, App. 8/28/70; amended by Ord. 21-98, App. 1/16/98)

SF Business and Tax Regulations Code § 717 ADMINISTRATIVE AGREEMENTS.

SEC. 717. ADMINISTRATIVE AGREEMENTS. The Tax Collector may make administrative agreements with service suppliers to vary the strict requirements of this Article so that collection of any tax imposed herein may be made in conformance with the billing procedures of a particular service supplier so long as the overall result of said agreements results in collection of the tax in conformance with the general purpose and scope of this Article. A copy of each such agreement shall be on file and available for public examination in the Tax Collector's office. (Added by 287-70, App. 8/28/70)

SF Business and Tax Regulations Code § 717.1 REFUND AGREEMENTS.

SEC. 717.1. REFUND AGREEMENTS. Notwithstanding the provisions of Section 714 above, the Tax Collector may enter into agreements with service suppliers to refund to service users previously collected taxes based upon charges which were subsequently ordered by the Public Utilities Commission of the State of California to be refunded to the service user by the service supplier. (Added by Ord. 242-77, App. 6/17/77)

SF Business and Tax Regulations Code § 719 CALIFORNIA PUBLIC UTILITIES COMMISSION JURISDICTION.

SEC. 719. CALIFORNIA PUBLIC UTILITIES COMMISSION JURISDICTION. Nothing contained in this Article is intended to conflict with applicable rules, regulations and tariffs of any service supplier subject to the jurisdiction of the California Public Utilities Commission. In the event of any conflict, the provisions of said rules, regulations and tariffs shall control. (Added by Ord. 287-70, App. 8/28/70)

SF Business and Tax Regulations Code § 720 PURPOSE.

SEC. 720. PURPOSE. The taxes imposed and levied by the provisions of this Article are solely for the purpose of providing revenue for the usual current expenses of the City. The provisions of this Article are not enacted for regulatory purposes. (Added by Ord. 287-70, App. 8/28/70; amended by Ord. 419-93, App. 12/23/93; Ord. 21-98, App. 1/16/98)

SF Business and Tax Regulations Code § 721 EFFECT OF STATE AND FEDERAL AUTHORIZATION.

SEC. 721. EFFECT OF STATE AND FEDERAL AUTHORIZATION. To the extent that the City's authorization to impose or collect any tax imposed under Section 703 of this Article or Article 10B is expanded or limited as a result of changes in state or Federal law, no amendment or modification of Section 703 or Article 10B shall be required to conform the taxes to those changes, and the taxes shall be imposed and collected to the full extent of the City's authorization up to the full amount of the taxes imposed under Section 703 and Article 10B. (Added by Proposition O, § 4, 11/4/2008)

SF Business and Tax Regulations Code § 722 AMENDMENT OF ORDINANCE.

SEC. 722. AMENDMENT OF ORDINANCE. Article 6, Article 10 and Article 10B of the Business and Tax Regulations Code may be repealed or amended by the Board of Supervisors without a vote of the people except as follows: as required by Article XIII C of the California Constitution ("Proposition 218"), any amendment that increases the amount or rate of tax beyond the levels authorized by this Ordinance may not take effect unless approved by a vote of the people. The Board of Supervisors may impose the taxes authorized by Section 703 and Article 10B in any amount or rate which does not exceed the amount or rate approved by the voters. (Added by Proposition O, § 4, 11/4/2008)

SF Business and Tax Regulations Code § 723 SEVERABILITY.

SEC. 723. SEVERABILITY. If any section, sentence, clause, phrase, or portion of Article 6, Article 10 or Article 10B is for any reason held to be invalid or unenforceable by a court of competent jurisdiction, the remaining sections, sentences, clauses, phrases, or portions of these Articles shall nonetheless remain in full force and effect. The people of the City and County of San Francisco hereby declare that they would have adopted each section, sentence, clause, phrase, or portion of these Articles, irrespective of the fact that any one or more sections, sentences, clauses, phrases, or portions of these Articles be declared invalid or unenforceable and, to that end, the provisions of these Articles are severable. (Added by Proposition O, § 4, 11/4/2008) ARTICLE 10A: [RESERVED] SECS. 750 — 770. RESERVED. (Repealed by Proposition O, § 2, 11/4/2008)
Source: City and County of San Francisco, Charter and Municipal Codes (American Legal Publishing, codelibrary.amlegal.com)URL: https://codelibrary.amlegal.com/codes/san_francisco/latest/sf_business/0-0-0-1610Fetched: 11/1/2026

Starting a business in California? California LLC guide: costs and requirements