Manteca council backs recommendation to split Bradley Burns sales tax for e-commerce; city could gain an estimated $2 million
Loading...
Summary
The council voted 3-0 to support a working-group recommendation to reallocate Bradley Burns local sales tax on e-commerce transactions so that half follows the warehouse (point of sale) and half follows the delivery location; staff projected the change could increase Manteca's sales tax revenue by under 10 percent, about $2 million based on FY25.
The Manteca City Council on Sept. 16 voted to support the city manager’s sales tax working group recommendation to change how the Bradley Burns 1% local sales tax is allocated for e-commerce transactions.
Interim Finance Director Matt (last name not stated) presented the working-group proposal, which recommends splitting the Bradley Burns portion of sales tax for e-commerce transactions so that 50% would follow the current point-of-sale allocation (typically the fulfillment center or warehouse) and 50% would be allocated to the jurisdiction where the package is delivered. The proposal allows flexibility of plus or minus 10 percent in the split and a proposed five-year phase-in pending California Department of Tax and Fee Administration administrative methodology.
Matt told council that the League of California Cities analyzed 483 cities and found about 255 would gain revenue, 105 would lose revenue, and 123 had insufficient data. "Based on their study, it potentially could be a $2,000,000 increase in our sales tax revenue," Matt said, noting the city’s FY25 baseline where a 1% change equates to roughly $200,000 for Manteca.
Councilmembers voiced support. Councilmember Morwitt called the proposal "a win win for the city of Manteca" and said the change "is only fair" given online shopping trends and delivery-related wear on city streets. Councilmember Breitenbucher noted the proposal does not increase overall tax rates, saying, "people currently shopping online wouldn't pay anything additional. It would just be that the tax collected, a bigger percentage of it would come back to Manteca."
The motion to direct staff to send a letter of support to the League of California Cities and to advocate the change to relevant legislative bodies passed 3-0. The council asked staff to coordinate with Cal Cities and regional partners as the proposal moves through state administrative and legislative processes.
