The California Tourism Assessment Fee is a mandatory annual charge that travel-industry businesses pay to fund statewide tourism marketing through Visit California. You owe it if your business had at least $1 million in California gross receipts in the most recent tax year, more than 1% of those receipts came from travel and tourism, and your business falls within one of five designated industry categories. The California Office of Tourism, authorized under the California Tourism Marketing Act (Government Code Section 13995 and following), administers the program.1California Office of Tourism. About Us
Who Owes the Fee
Two thresholds decide whether you’re assessable. Your California gross receipts for the most recent tax year must be $1 million or more, and more than 1% of those receipts must come from travel and tourism revenue. Both conditions have to be met.2California Legislative Information. California Code GOV 13995.65
Your business also has to fit one of these five categories:
- Accommodations: hotels, motels, resorts, vacation rentals, and similar lodging
- Restaurants and retail with tourism-related revenue
- Attractions and recreation: theme parks, museums, outdoor recreation, entertainment venues
- Transportation and travel services: airlines, shuttle services, travel agencies, tour operators
- Passenger car rental
If you get a filing notice from the California Office of Tourism, you must complete the Tourism Assessment Form, even if you believe you qualify for an exemption. Filing is what formally establishes exempt status.3California Office of Tourism. Assessable Business
How Much You’ll Pay
The rate depends on your industry category. California gross receipts means revenue from in-state sales minus returns and allowances, excluding collected sales taxes.4California Office of Tourism. Definitions
- Accommodations: $1,950 per $1 million of travel and tourism revenue (0.195%)
- Restaurants and retail: $975 per $1 million (0.0975%)
- Attractions and recreation: $975 per $1 million (0.0975%)
- Transportation and travel services: $975 per $1 million (0.0975%)
- Passenger car rental: 3.5% of monthly revenue
Passenger car rental uses a percentage of monthly revenue rather than the annual per-million formula the other categories use.5California Office of Tourism. Tourism Assessment Program – Frequently Asked Questions
Exemptions and Excluded Revenue
Accommodation providers do not owe the assessment on revenue from a guest staying 31 continuous nights or longer. When calculating assessable revenue, lodging businesses subtract those long-stay receipts from their travel and tourism total.6California Office of Tourism. Calculate Assessment
Travel agencies, tour operators, packagers, and wholesalers are exempt if less than 20% of their California gross revenue comes from travel and tourism occurring inside the state. An agency that mostly books out-of-state or international trips would typically fall below this threshold.7Legal Information Institute (LII) / Cornell Law School. California Code of Regulations Title 10 5353 – Tourism Assessment Form
Certain revenue streams are excluded from the calculation base before you figure your assessable amount:
- Rentals of more than 30 days for recreational watercraft and marine equipment, including canoes, houseboats, and sailboards
- Interstate transportation and diesel fuel sales
- Regular-route bus service crossing state lines4California Office of Tourism. Definitions
Claiming an exemption does not excuse you from filing. If you received a notice, you still need to submit the form.
How to Register and File
Businesses that receive a notice register through the California Office of Tourism’s online portal, which creates an account for future filings.8California Office of Tourism. Register User The Tourism Assessment Form asks for your total California gross receipts and the percentage of that revenue derived from travel and tourism. Your reporting period should match the period you use for annual tax reporting.6California Office of Tourism. Calculate Assessment
The form must be certified and signed by an authorized representative under penalty of perjury. That signature means you are personally attesting that the revenue figures and any claimed exemptions are accurate, so keep detailed records of how you calculated your tourism revenue percentage and documentation for any exempt revenue you subtracted.7Legal Information Institute (LII) / Cornell Law School. California Code of Regulations Title 10 5353 – Tourism Assessment Form
What Late or Missed Filings Cost
The state can add a penalty of up to 10% of the unpaid assessment to cover enforcement costs. Interest begins accruing on the unpaid balance 30 days after the Office of Tourism issues a notice of failure to pay.7Legal Information Institute (LII) / Cornell Law School. California Code of Regulations Title 10 5353 – Tourism Assessment Form
Noncompliance can also trigger an audit. Auditors will review your gross receipts records and the basis for any exemption claims. Businesses that never filed tend to fare worst, because they have no documented position to defend. File on time, even if you believe you owe nothing.
Passing the Fee to Customers
California law lets you pass some or all of the assessment on to your customers. It’s optional, and if you do pass it along, you are not required to itemize it as a separate line on a receipt or invoice. Any amount you pass to customers does not count as part of your gross receipts for future assessments or for sales tax calculations.2California Legislative Information. California Code GOV 13995.65
Lodging businesses that itemize the fee should be aware of the federal Rule on Unfair or Deceptive Fees, effective May 12, 2025. Under that rule, any mandatory charge a hotel or short-term lodging provider knows about and can calculate upfront must be included in the total price shown to guests. You can still itemize the tourism assessment separately on a bill, but the total price displayed during booking must be the most prominent figure and must include the charge.9Federal Trade Commission. The Rule on Unfair or Deceptive Fees: Frequently Asked Questions
Deducting the Assessment on Your Taxes
The tourism assessment is a mandatory regulatory fee, which makes it a deductible business expense on your federal income tax return. Sole proprietors and single-member LLCs report it on Schedule C (Form 1040), line 23, which covers licenses and regulatory fees paid to state or local governments for your trade or business.10IRS. 2025 Instructions for Schedule C (Form 1040) – Profit or Loss From Business Corporations and partnerships deduct it through their business expense lines. Keep your assessment filings and payment receipts with your tax records.