Gilroy, CA Hotels & Lodging: Transient Occupancy Tax (2026)

Gilroy's transient occupancy tax, adopted by Ordinance No. 928 in 1971, taxes occupancy in any 'Hotel' as defined by City Code Section 25A.1: not just conventional hotels and motels, but any recreational vehicle park, mobile home or house trailer at a fixed location, or other structure occupied by a transient for dwelling, lodging or sleeping purposes, so the chapter's tax base reaches short-term rentals and RV stays alongside traditional hotels. Under Section 25A.2, that transient owes the City of Gilroy nine percent of the rent charged by the operator, payable at the time rent is paid, or with each installment if rent is paid in installments; if the operator does not collect it, the director of finance can require the transient to pay the tax directly.

Every operator must register the hotel with the director of finance under Section 25A.5 and post the resulting Transient Occupancy Registration Certificate on the premises, then file a quarterly return and remit the tax collected under Section 25A.6, holding the money in trust for the city until it is paid over. Miss the deadline and Section 25A.7 imposes an original delinquency penalty of ten percent of the tax due, on top of which the director of finance adds further delinquency and fraud penalties for continued nonpayment, plus interest at eighteen percent per year on the unpaid tax and penalties until paid.

An operator who disputes the director of finance's assessment can request a hearing under Section 25A.8 and then appeal to the city council under Section 25A.9, whose findings are final. Any violation of the chapter, including an operator's failure to collect, register or remit the tax, is an infraction under Section 25A.13.