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As LA City Council begins grappling with a near $1 billion dollar budget shortfall, they are considering a slew of potential taxes. The two that could significantly increase costs for commercial buildings are a Parking Occupancy Tax (POT) increase and a new Vacancy Tax. Both are moving through the Budget & Finance Committee and could be placed on upcoming ballots as early as 2026.
What’s Being Proposed
Parking Occupancy Tax Increase 🚨
The City is considering raising the POT from 10% to as high as 20%. This tax applies to most paid parking—including tenant, employee, visitor, and customer parking - directly increasing costs for buildings and the people who use them.
Commercial Vacancy Tax 🚨
This proposal would penalize “unused” properties and is already being discussed with a focus on commercial buildings, despite market conditions and long lease-up timelines outside an owner’s control.
Why It Matters
Together, these proposals would raise operating costs, undermine tenant retention and leasing, and further challenge already-strained commercial corridors—particularly Downtown and other high-cost districts. Rather than addressing the root causes of vacancy and reduced demand, these taxes would increase financial pressure on properties working to reinvest and stabilize.
BOMA/GLA Is Taking Action 📣
BOMA/GLA is actively coordinating with the Los Angeles Parking Association (LAPA) to provide educational outreach to Council offices regarding the negative impacts increasing the parking tax would have on the entire City. As well as actively talking against a CRE vacancy tax.
👉 Stay tuned to BOMA on the Frontline for updates, action alerts, and opportunities to engage.
📩 Interested in joining our coalition efforts? Email us to get involved and share how these proposals would affect your properties.
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