Gilroy, CA Local Taxes & Fees: Business Tax Classification (2026)
Key Facts
- Default tax basis
- Gross annual receipts
- Alternate track
- Council-enumerated fixed schedule
- Affidavit due
- January 1 each year
- Noncompliance assessment
- $2,000 per year
- Late penalty
- 25% plus 10% per month
- Collector power
- Audit books and accounts
Summary
Gilroy sorts businesses into two license-tax tracks under City Code §§ 13.39-13.40: most pay a tax the city council sets by resolution based on gross annual receipts, while the council can single out specific trades, like vending machines and amusement devices, for a flat enumerated fee schedule instead.
§ 13.39. Same – Based on gross receipts. Every person conducting, managing or carrying on at a fixed place of business in the city any business, trade, profession or calling, whether as a merchant or otherwise, unless specifically licensed by section 13.40 of this article, shall pay as a license tax for revenue purposes only an amount which shall be fixed and regulated by council resolution based upon the gross annual receipts of such business, trade, profession or calling. ... ... § 13.40. Same – Certain enumerated businesses. The council may by resolution identify specific businesses, trades, professions, or callings, conducted at a fixed place of business in or out of the city, including vending machines, jukeboxes and amusement devices, for which annual license fees may be fixed and established by council resolution.
Full Breakdown
Chapter 13 splits Gilroy's business license tax into two classification tracks rather than one flat schedule. Section 13.39 is the default: every business, trade, profession or calling with a fixed place of business in the city pays a license tax set by council resolution and based on that business's gross annual receipts, unless § 13.40 specifically licenses it another way. Section 13.40 lets the council carve out named categories, including vending machines, jukeboxes and amusement devices, in or out of the city, for their own fixed annual fee schedule set separately by resolution rather than by gross receipts.
Businesses must self-report under § 13.11: every January 1, anyone taxed under the gross-receipts track files a verified affidavit of the prior year's gross annual receipts with the license collector. The license collector can audit the underlying books under § 13.12, and a business that refuses to file the affidavit or open its books within 30 days gets arbitrarily assessed at $2,000 a year until it complies. Affidavits themselves stay confidential and the license cannot show the tax amount paid on its face (§ 13.13).
Transient businesses, out-of-city businesses making deliveries into Gilroy, and enumerated categories like carnivals and private patrols each get their own fee-setting mechanism under §§ 13.41-13.44, layered on top of this two-track classification.
Violations & Fines
Missing the January 1 gross-receipts affidavit, or refusing to let the license collector examine the underlying books, triggers an arbitrary $2,000 annual assessment under § 13.12 until the business complies. Unpaid license taxes carry a 25 percent late penalty plus 10 percent for each additional month under § 13.29, and the city administrator can sue to collect, adding a 50 percent penalty and costs under § 13.20.
Frequently Asked Questions
How does Gilroy decide how much business license tax I owe?
What happens if I don't file my gross receipts affidavit with Gilroy?
Are vending machines taxed differently than other Gilroy businesses?
Sources & Official References
Other rules in Gilroy
California rules heatmap·Compare Gilroy to another location·View the California local taxes & fees overview
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Business Tax Classification in Nearby Cities
How other cities in Santa Clara County handle business tax classification.