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A. Nothing in this article shall be construed as requiring the payment of any tax for engaging in a business or the doing of an act when such payment would constitute an unlawful burden upon or an unlawful interference with interstate or foreign commerce, or which payment would be in violation of the constitution of the United States or the constitution of the state of California.
B. Subject to first applying for and obtaining a business tax registration certificate with the classification of exempt from the city, the following persons and activities are exempt from taxation:
1. Nonprofit or charitable organizations including, without limitation, fraternal, educational, civic, state, military, county and municipal organizations or associations (hereafter collectively "nonprofit entities"), which have the appropriate tax designation or classification from federal and state taxing authorities.
2. Religious institutions which have the appropriate tax designation or classification from federal and state taxing authorities.
3. Credit unions which have the appropriate tax designation or classification from federal and state taxing authorities.
C. Notwithstanding the provisions of subsection B of this section, exempt entities shall not be exempt from the payment of a tax in their sponsorship or participation in events involving the theater or arts, dances, concerts, lectures, sports or similar activities unless all of the net proceeds, defined for these purposes as the net amount derived from revenues of the event less the direct costs of the event, derived from the event are used for the operation of these entities or institutions, or for some other nonprofit charitable or benevolent purpose.
D. No person engaged in business in the city shall be entitled to a tax exemption by virtue of the sponsorship or participation of any nonprofit entity or religious institution (regardless of any revenue sharing or other form of compensation) in an otherwise taxable activity or event, including, without limitation, those described in subsection B of this section.
E. An exemption granted for any activity set forth in subsection B of this section is void and payment of the entire business tax is required if said activity was conducted in such a manner that the city would not have granted an exemption had same been accurately described or fully disclosed in the application for an exemption. Furthermore, the failure to use net proceeds in the manner required by subsection C of this section shall result in any exemption being void and the entire business tax being immediately due. All tax obligations arising by reason of this section shall be immediately due and payable along with any penalties and interest.
F. For the purposes of this section, city purchases shall be exempt from the calculation of the required business tax as follows:
1. Whenever the measure of the business tax is based on gross receipts, the person subject to the business tax may exclude from the business tax calculation the dollar value of purchases made directly by the city of Beverly Hills from the person subject to the tax.
2. Whenever the measure of the business tax is based on gross payroll, number of persons employed, number of vehicles, devices, or articles of equipment used, the person subject to the business tax may exclude from the business tax calculation the dollar value of the payroll, hours related to the persons employed, hours related to the number of vehicles, devices, or articles of equipment used in providing goods or services related to purchases made directly by the city of Beverly Hills from the person subject to the tax. (Ord. 96-O-2255, eff. 3-22-1996)