Tax rates are set by the governing body and range from 0.5 percent to 12 percent. The tax is most commonly based on gross receipts or levied at a flat rate. Cities rely on the business license tax for roughly 7 percent of general purpose tax revenues. In addition, special taxes such as the Mello-Roos Community Facilities Tax, library services tax, parcel tax, and police and fire services tax are also imposed by some local governments. These vary widely across different types of local governments.
Typical examples are property and sales taxes.
Ad valorem taxes contrast with per-unit taxes, such as California's alcoholic beverage and cigarette taxes, which are assessed at a fixed dollar amount per unit of the item purchased. An amount calculated for income tax purposes which equals total income minus various exclusions, exemptions, and adjustments. An additional tax that must be computed by individual and corporate taxpayers who take advantage of certain special tax preferences. If this tax exceeds the regular tax liability, the excess amount is separately assessed. In addition, the AMT can reduce the amount of tax credits that can be claimed, even if a separate add-on AMT liability is not owed.