Gutknecht

These cross-appeals arise from an action by plaintiffs, food take-out businesses, challenging the validity of the City of Sausalito’s business license ordinance and seeking refund of the license taxes paid. The trial court upheld the ordinance and denied the refunds, except for that portion resulting from a retroactive application. The Merchants contend that the ordinance is unconstitutional for vagueness and denial of equal protection, and is merely a subterfuge for eliminating them from the City. The City contends that the retroactive aspect of the tax was proper. We conclude that the ordinance is constitutional, and that the retroactivity of the tax was properly limited to the then current tax year.

The City of Sausalito adopted Ordinance No. 716 on August 6, 1968, providing for the licensing of various businesses within the City, and requiring the payment of a license tax prior to issuance of the business license. Although some businesses were charged a flat rate license tax, under section 23 of the ordinance most businesses were required to pay a $25 annual registration fee plus a percentage of gross receipts. The ordinance contained five separate business…