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

Municipal Code Chapter III-13, enacted under Revenue and Taxation Code §§ 7280 and 7281, imposes a transient occupancy tax capped at 14 percent of the rent charged for occupancy in any hotel. The code defines "hotel" broadly to include any structure or portion of a structure occupied or designed for occupancy by transients for dwelling, lodging or sleeping, covering hotels, motels, inns, tourist homes, rooming houses and even a mobilehome located outside a mobilehome park, which sweeps in most short-term rental arrangements; it excludes timeshare estates, membership camping contracts, and mobilehomes inside a licensed mobile home park.

A "transient" is anyone occupying a room for 30 consecutive days or less; a guest can avoid transient status only by signing, before occupancy begins, a written agreement obligating them to pay market rate for at least 31 consecutive days and transferring exclusive possession of the space. The operator collects the tax at the same time as rent, must state it separately from rent on the receipt, and holds it in trust for the City until remitted to the License Tax Collector. The City Council can adjust the rate up or down by ordinance without a public vote, but cannot exceed the 14 percent ceiling or change the tax methodology without voter approval under California Constitution Article XIIIC.

Exemptions apply to federal and state officers on official business paying with a government check or card, and to foreign government officers exempt under treaty or federal law.