How Much in Sales Tax Do Tourists Pay to the City of Paso Robles

I’ve heard it claimed that tourists pay the majority of sales tax in the City of Paso Robles. This typically comes up with respect to supplemental sales tax measures like E12, J20 and most recently measure E24 just approved last November. But is that a true statement?

In the city’s 2023 video, "Paving the Way - The E12 Roads Tax Journey", former City Manager Ty Lewis states, "We have about 6 million dollars a year in dedicated revenue that's solely spent on roads---and tourism pays for the majority of that through sales tax."

How did Mr. Lewis calculate a majority of sales tax coming from tourism? To get an expert opinion, I asked the question to our elected City Treasurer Ryan Cornell via the ‘Ask Your City Treasurer’ feature at the city’s website.

To my surprise, I received an email from City Manager Lewis and not City Treasurer Cornell. In that email he listed a number of diverse economic impacts of tourism, but did not answer my question about who pays the city the most sales tax. In the end, I’ve yet to have the statement verified. The City Treasurer never responded to my inquiry.

More recently at the April 1, 2025 City Council Meeting, Council Member Fred Strong claimed that the 'vast majority of sales tax is paid by tourists' and 'residents only pay on large items--like autos'.

After hearing that, I sent an email to the city council members regarding Council Member Strong’s statements. The following paragraphs are taken from statements in that email.

In the recent study the city had performed by a Los Angeles Consultant on the "Economic, Fiscal, and Social Impact of Tourism" (pg 26), it states:

In 2023, direct visitor spending generated $8.3 million(1) in sales tax revenue, accounting for approximately 25%(2) of the city’s total sales tax revenue.

Notes:

(1) $5.0 million flowed to Paso Robles’ General Fund, where $3.3 million flowed to Measure J-20 Supplemental Sales Tax Fund

(2) This result was calculated by dividing the city’s tourism-generated sales tax revenue ($8.3 million) by its total reported sales tax revenue for FY 2022/2023 ($33.4 million)

I will note here that 25% is not a 'vast majority'.

And then there's the claim that residents only pay sales tax on large purchases. I also believe this to be untrue.

What is taxable? According to the State of California on their website here :

"Retail sales of tangible personal property in California are generally subject to sales tax. Examples of tangible personal property include such items as furniture, giftware, toys, antiques, clothing, and so forth. In addition, some service and labor costs are subject to sales tax if they result in the creation of tangible personal property." . . .

"Some sales and purchases are exempt from sales and use tax. Examples of exempt sales include, but are not limited to, sales of certain food products for human consumption, sales to the U.S. Government, and sales of prescription medicine."

Residents pay sales tax every day. And not just on large items like automobiles.

We pay sales tax for the clothes on our back and the shoes on our feet. We pay sales tax for towels in our bath, sheets on our bed, and the pillows for our head. We pay sales tax on our home repair and improvement needs. We pay sales tax on repair parts for our automobiles. We pay sales tax on tools and materials for our jobs and hobbies.

Recently, I paid sales tax for my breakfast Egg McMuffin meal at McDonald's. I paid sales tax on a new water pressure regulator for my house and a new battery for my motor vehicle. I pay sales tax on every beverage I purchase from the grocery store. I even pay sales tax on the CRV for these beverages.

To say that residents only pay sales tax on large items is untrue.

As I stated in my email to the city council: If the city can justify to me that tourists pay a 'vast majority' of sales tax in Paso Robles and residents only pay sales tax for large items--then please explain. Otherwise, I would like the city and council members to stop making these claims. Aside from not being accurate--it's insulting to local residents. It discounts the large contributions local residents make to the city's revenue on a daily basis.