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

Under Novato Municipal Code § 16-2.3, the Uniform Hotel Room Tax is twelve percent of the rent charged by the operator, owed by each transient for the privilege of occupancy in any hotel. The proceeds go to the City of Novato general fund for general fund purposes, not to a dedicated account. Section 16-2.2 defines a transient as a person occupying space for 30 consecutive calendar days or less, and defines rent as all consideration charged for occupancy, whether received in money, goods, labor or otherwise, with no deduction.

The operator collects the tax at the time the rent is paid. Section 16-2.5 requires the tax to be stated separately from the rent, requires a receipt for each transient, and bars the operator from advertising that the tax will be absorbed, left off the rent, or refunded. If rent is paid in installments, a proportionate share of the tax is due with each installment. If the transient never pays the operator, the tax collector, who under § 16-2.2 is the Novato city manager or a person the city manager designates, can require the tax to be paid directly.

Registration comes first. Under § 16-2.6 each operator registers the hotel with the tax collector within 30 days after commencing business and posts the Transient Occupancy Registration Certificate in a conspicuous place on the premises. The certificate states on its face that it is not a permit. Under § 16-2.7 returns are due on or before the last day of the month following the close of each calendar quarter, the full tax collected is remitted with the return, and the tax is held in trust for the City until paid. The tax collector can set shorter reporting periods for any certificate holder. Operators keep records for three years under § 16-2.11, and the tax collector can inspect them at all reasonable times.

Exemptions under § 16-2.4 are narrow: occupancies the City has no power to tax, officers or employees of a foreign government exempt under federal law or international treaty who claim the exemption on a prescribed form under penalty of perjury when the rent is collected, and occupancies paid for by the American Red Cross when housing disaster victims in a hotel on a temporary basis.