Lake Havasu City, AZ Local Taxes & Fees: Business Tax Classification (2026)

Article IV of Chapter 3.04, Privilege Taxes, imposes the city's Transaction Privilege Tax by naming each taxable business classification separately rather than applying one flat rate citywide. Section 3.04-400(a) levies the general Privilege Tax on business activity measured by gross income, plus a separate occupancy tax under Section 3.04-440 and a jet fuel sales tax under Section 3.04-422. From there, more than two dozen classification sections in Article IV each set their own rate: restaurants and bars pay three percent of gross income under Section 3.04-455(a), covering food or drink prepared or served for consumption on or off the premises and including catering, while general retail sales of tangible personal property are taxed at two percent under Section 3.04-460(a).

Other named classifications carry the same two percent rate, including advertising (Section 3.04-405), amusements and exhibitions such as theaters, bowling alleys and golf courses (Section 3.04-410), construction contracting (Section 3.04-415), hotels (Section 3.04-444), and rental or leasing of real property (Section 3.04-445). A business operating in more than one classification at one location does not need a separate license for each activity, but Section 3.03-300(c) requires it to list every classification on its license application with the Tax Collector. Returns and payments are administered by the Tax Collector under Chapter 3.05, and late or unpaid tax draws interest and civil penalties under Section 3.05-540 applied in the same manner as the state Transaction Privilege Tax penalties in A.R.S. Sections 42-1123 and 42-1125.