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Development Construction Taxes

In San José, new development and construction are taxed for local and state purposes. The taxes are collected by the City’s Permit Center when the building permit is issued.

City Taxes

The City Council has imposed four construction-related excise taxes to fund specific City operations. These taxes are outlined in Chapter 4 of the Municipal Code and include exemptions for certain types of projects or projects in incentive zones. Links are provided below.

State Taxes

The State of California has imposed two construction-related excise taxes. Links are provided below for more information.

Tax Tax Rate
Building & Structure Construction Tax (B&S)
Chapter 4.46 of the San José Municipal Code
This tax is based on the valuation of the project as assessed by Building Division Policy.

Tax Rate of Building Valuation
Residential: 1 3/4% of 88% of Building Valuation (1.54%)
Commercial: 1 1/2% of Building Valuation
Industrial: 1%

Office Use: 1.5% of Building Valuation
Commercial, Residential, Mobile Home Park Construction Tax (CRMP)
Chapter 4.47 of the San José Municipal Code
This tax is based on the valuation of the project as assessed by Building Division Policy.

Tax Rate of Building Valuation
Residential: 2 3/4% of 88% of Building Valuation (2.42%)
Commercial: 3%

Office Use: 3% of Building Valuation
Construction Tax
Chapter 4.54 of the San José Municipal Code
This tax is based on the number of new dwelling units or new floor area. See Chapter 4.54.050 of the San José Municipal Code for the specific tax schedule.		 Tax Per Unit
Residential: $75 - $150

Tax Rate of New Floor Area
Commercial: $0.08 /sf
Industrial: $0.08 /sf
Residential Construction Tax
Chapter 4.64 of the San José Municipal Code
This tax is based on the number of new dwellings or units. Chapter 4.64.050 of the San José Municipal Code outlines the range of fees that depend on the type of dwelling or unit.		 Tax Per Dwelling or Unit
Residential: $90 - $180
Strong Motion Instrumentation Program Assessment (SMIPA)
California Strong Motion Instrumentation Program. This state tax funds the study of earthquakes. The tax is based on the valuation of the project. This is a State of California fee that the City collects and submits to the State.		 Tax Rate of Building Valuation
Residential: $.10/ $1,000.00 (Revised 4/1/91) (.0001)
Commercial: $.28/ $1,000.00 (Revised 7/1/14) (.00028)
Building Standards Administration Special Revolving Fund (BSARSF)
California Building Standards Commission. This state tax is for the purpose of carrying out the provisions of the State Building Standards Law and provisions of State Housing Law that relate to building standards. The tax is based on the valuation of the project. This is a State of California fee that the City collects and submits to the State at the rate of .004% of the Building Valuation.		 Tax Rate of Building Valuation
Residential and Commercial:
$1 for every $25,000 of valuation,
in $1 increments.