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(Title and Section Amended by Ord No. 176,324, Eff. 1/16/05, Oper. 1/1/06.)
Commencing with the tax year 2006, the tax rates contained in this Article which are based upon gross receipts shall be reduced by up to 4% per year. The maximum total rate reduction shall be 15% from the rates imposed as of December 31, 2005. The yearly tax rate reduction shall be calculated by the Director of Finance on a percentage basis rounded to the nearest one-tenth percent (1/10%) from the net increase in business tax revenue above a baseline. Net business tax revenue shall be the amount credited as Business Tax in the Statement of Receipts published in the annual Controller’s Preliminary Financial Report. The baseline shall be the revenue forecast for business tax receipts prepared in conjunction with the 2004-2005 City budget set forth as follows:
Fiscal Year Revenue Forecast
2004-2005 $384,815,000
2005-2006 $400,977,000
2006-2007 $417,016,000
2007-2008 $433,697,000
2008-2009 $451,045,000
2009-2010 $469,087,000
The baseline revenue forecast for each year beyond the 2009-2010 shall be calculated based upon a 4% per annum increase from the previous year.
There shall be no tax reduction in any year in which the net revenue increase is less than one percent (1%). Any percentage increase below one percent (1%) shall be carried over and added to the next year percentage increase for purposes of calculating the rate reduction for that year.
The Director of Finance shall issue a detailed annual report on the net business tax revenue received each fiscal year and the basis for all calculations and carryovers and shall publish or otherwise publicize the revised rates for each year.
All business taxes shall be paid to the Director of Finance in lawful money of the United States and taxes required hereunder shall be paid in advance except where otherwise specifically provided, and shall be due and payable at the following times:
(a) Annual business taxes on the first day of January of each year;
(b) Quarterly business taxes on the first days of January, April, July and October of each year;
(c) Monthly business taxes on the first day of each month;
(d) Daily business taxes on each day;
(e) When a business discontinues, dissolves, or otherwise terminates before the expiration of a business tax period, any taxes accrued and owing to the City under the provisions of this article or Article 1.5, including any business taxes that would not otherwise be payable under the close of the business tax period during which termination occurs, or until time for paying the tax for the next succeeding business tax period, shall be due on the date of termination.
(f) When a person first becomes subject to business tax by reason of an amendment of this article, or because of such an amendment, becomes subject to business tax under a section not previously applicable to such person or on a basis not previously applicable to such person, any new or additional tax required to be paid by reason of this article, as so amended shall be due and payable upon the effective date of the amending ordinance unless an operative date different from the effective date of the amendment is specified therein. (Added by Ord. No. 128,639, Eff. 11/30/64.)
(Amended by Ord. No. 179,984, Eff. 8/3/08.)
(a) Delinquent Dates: (Amended by Ord. No. 181,857, Eff. 10/4/11.) Unless otherwise specifically provided for in other provisions of this Article, all business taxes required to be paid shall be deemed delinquent if not paid on or before or within the time prescribed in this Article:
1. Annual Business Taxes – on or before the close of business on the last day of the month following the month in which the tax is due.
2. Quarterly Business Taxes – on or before the close of business on the last day of the month in which the tax is due.
3. Monthly Business Taxes – on or before the close of business on the last day of the month for which the tax is due.
4. Daily Business Taxes – on or before the close of business on each day for which the tax is due.
5. Business Taxes Unpaid When a Business Has Been Discontinued, Dissolved or Otherwise Terminated – within 45 days of the termination of the business.
6. Deficiency Determinations – within 60 days of the date on which the Office of Finance provides notice of determination on an assessment or notice of the decision of an Assessment Review Officer, if applicable, or within 30 days of the date on which the Office of Finance provides notice of the decision of a Board of Review, whichever is later.
7. Notwithstanding any other provisions in this Code, any business tax owed for business activity conducted during the 2020 Calendar Year shall not be due until February 28, 2022, for the following business tax classifications: (Added by Ord. No. 187,119, Eff. 8/7/21.)
(a) Section 21.53 (Amusement Park).
(b) Section 21.62 (Billiards, Etc.).
(c) Section 21.63 (Amusement Machines).
(d) Section 21.64 (Coin Operated Phonographs and Music Machines).
(e) Section 21.65.1 (Coin Operated Scales and Service Machines).
(f) Section 21.70 (Bowling Alley, Skee- ball Shuffleboard, Etc.).
(g) Section 21.74 (Circuses).
(h) Section 21.83 (Dance Hall).
(i) Section 21.85 (Public Dance).
(j) Section 21.94 (Rides).
(b) Penalties:
1. Original Delinquency. Any person who fails to pay any tax required to be paid by this article, except deficiency determinations made by the Director of Finance under Subsection (i) of Section 21.15 of this article, within the time required shall pay a penalty of 5% of the amount of the tax in addition to the amount of the tax.
2. Continued Delinquency. Any person who fails to pay any delinquent tax, except deficiency determinations made by the Director of Finance under Subsection (i) of Section 21.15 of this article, on or before the last day of:
(i) The first month in which the tax first became delinquent, shall pay a second penalty of 5% of the amount of the tax in addition to the amount of the tax and the 5% penalty first imposed;
(ii) The second month in which the tax first became delinquent, shall pay a third penalty of 5% of the amount of the tax in addition to the amount of the tax and the 10% in accumulated penalties previously imposed;
(iii) The third month in which the tax first became delinquent, shall pay a fourth penalty of 5% of the amount of the tax in addition to the amount of the tax and the 15% in accumulated penalties previously imposed.
(iv) The fourth month in which the tax first became delinquent, shall pay a fifth penalty of 20% of the amount of the tax in addition to the amount of the tax and the 20% in accumulated penalties previously imposed.
3. Deficiency Determinations. Any person who fails to pay a deficiency determination within 30 days after the Director of Finance has notified the person of the amount of the deficiency, shall pay a penalty of 20% of the amount of the deficiency determination in addition to the amount of the deficiency determination. Notice of a deficiency determination shall be given in writing in the manner provided for the service of notices of assessment in Subsection (b) of Section 21.16.
4. Overpayment. For the purpose of allowing overpayments as credit against underpayments of the above-mentioned taxes, whenever the overpayment has been received by the City within the three years prior to an underpayment, or during any year for which the taxpayer, at the request of the Director of Finance, has executed a waiver of the defense of the statute of limitations with regard to any claim the City may have for business tax, the Director of Finance, when making determinations of the amount of taxes due the City, shall make an allowance of credit for any overpayment. Overpayments shall be applied to underpayments in the oldest period(s) before applying to a later period(s). Whenever an overpayment has been made prior to an underpayment, no penalty or interest shall apply upon the amount of the underpayment satisfied by the prior overpayment.
(c) Negligence. If the Director of Finance determines that the nonpayment of any tax due under this article or Article 1.6 is due to negligence or willful disregard of the provisions of this article or Article 1.6, a penalty of 10% of the amount of the tax shall be added to the tax due in addition to the penalties stated in Subdivisions 1. and 2. of Subsection (b) of this section. If the Director of Finance determines that any part of the deficiency of a deficiency determination is due to negligence or willful disregard of the provisions of this article or Article 1.6, a penalty of 10% of the amount of the deficiency determination shall be added in addition to the penalties stated in Subdivision 3. of Subsection (b) of this section.
(d) Fraud. If the Director of Finance determines that the nonpayment of any tax due under this article or Article 1.6 is due to fraud, a penalty of 25% of the amount of the tax shall be added, in addition to the penalties stated in Subdivisions 1. and 2. of Subsection (b) of this section. If the Director of Finance determines that any part of the deficiency determination is due to fraud, a penalty of 25% of the amount of the deficiency determination shall be added, in addition to the penalties stated in Subdivision 3. of Subsection (b) of this section.
(e) Interest. In addition to the penalties imposed, any person who fails to pay any tax required to be paid by this article or Articles 1.1, 1.3, 1.7, or 1.15 of this chapter shall pay interest on the amount of the tax, exclusive of any penalty, from the date on which the tax first became delinquent until the date it is paid, during each calendar year at the rate per month, or fraction of the month, determined by dividing by 12 the sum of the average Federal short-term rate during the months of July, August and September of the prior calendar year plus three percentage points. Unless the monthly rate is evenly divisible by one-tenth of a percentage point, it shall be rounded up to the next highest one-tenth of a percentage point. Interest shall run during any period of time for which the Director of Finance has granted an extension of time. Interest required by any of the provisions of this section shall not be subject to waiver or compromise other than in accordance with the provisions of Subsections (f) and (g) of Section 21.15 of this article, or as the Council may direct.
(f) Penalties and Interest Merge With Tax For Collection Purposes. For collection purposes only, every penalty imposed and the interest that is accrued under the provisions of this section shall become a part of the tax required to be paid.
(a) Unless otherwise provided in this article, every person who engages in any business within this City which is subject to tax under the provisions of this article shall be deemed to be engaged in a separate business at each branch establishment or location at which the person engages in business and must obtain a separate registration certificate and pay a separate business tax for each classification of business engaged in at each location or branch establishment in the City at which or from which the business activities classified and subject to tax under the provisions of this article are carried on. Each registration certificate so obtained and the payment of the applicable tax for each such classification of business at each such location shall authorize the person named upon the certificate to engage only in the business specified at the location for which the certificate has been issued; provided that where business is engaged in from one or more locations outside the City, only one registration certificate for each classification of business need be issued to the person for engaging in that business in the City from all such outside locations; provided further, that warehouses and distributing plants located in the City used in connection with and incidental to a business for which a registration certificate has been issued to an address located within the City shall not be deemed to be branch establishments or separate locations. (Amended by Ord. No. 131,873, Eff. 3/31/66.)
(b) Whenever the business tax for a business imposed under the provisions of this article is measured by the number of vehicles, devices, machines, or other pieces of equipment used, or whenever the business tax is measured by the gross receipts from the operation of coin-operated machines, the Director of Finance shall issue only one registration certificate; provided that the Director of Finance shall issue for each tax period for which the business tax has been paid, one identifying sticker or symbol for each vehicle, device, machine or other piece of equipment included in the measure of the tax or for each coin-operated machine used in a business where the tax is measured by the gross receipts from such coin-operated machines.
(Added by Ord. No. 175,385, Eff. 9/14/03, Oper. 1/1/04.)
(a) When a person engages in a business that consists of two or more activities taxable on the basis of annual gross receipts and one of the activities generates at least 80% of the person’s annual taxable gross receipts, that person may elect on a yearly basis to have all of its taxable annual gross receipts reported and taxed at the rate applicable to the activity constituting at least 80% of annual taxable receipts.
Any business activities taxed other than on the basis of annual gross receipts shall not be combined with business activities taxed on the basis of annual gross receipts, and the receipts generated by the activities taxed other than on the basis of annual gross receipts shall continue to be taxed under the existing tax sections and shall be excluded in computing the 80% threshold.
The provisions of this section shall only apply to gross receipts generated by business activities conducted at or originating from the same location or as otherwise provided for under Section 21.06. All apportionments shall be made prior to electing the single primary tax classification using the appropriate apportionment formulas for each classification.
(b) Any tax deficiency or delinquency resulting from an election and payment made pursuant to Subsection (a) in which the primary tax category does not meet the 80% threshold shall accrue interest and penalties as set forth in Section 21.05 of this Article.
(Amended by Ord. No. 181,051, Eff. 1/31/10.)
(a) No claim for refund shall be allowed in whole or in part unless filed by the person claiming the overpayment, or the person’s authorized agent on the person’s behalf, with the City Clerk within a period of one year from the date of the claimed overpayment, and all such claims for refund of overpayment must be filed with the City Clerk on forms furnished by the City and in the manner prescribed by the City.
(b) Nothing in this section shall be deemed to bring into being or validate any claim for refund arising from a cause heretofore existent if such claim, whether filed or not, was or would have been invalid because of the then existing statutory term, and nothing in this section shall be deemed to validate, revive, restore or continue any claim for refund heretofore filed and denied.
(d) The City shall pay interest on the amount of each allowed claim for refund of overpayment of tax, from the date of filing the claim for refund or, in the case of a payment under protest or pursuant to a billing from the Office of Finance, from the date of overpayment, until the date the overpayment is paid, during each calendar year at the rate per month determined by dividing by 12 the sum of the average Federal short-term rate during the months of July, August and September of the prior calendar year. Unless the monthly rate is evenly divisible by one-tenth of a percentage point, it shall be rounded up to the next highest one-tenth of a percentage point.
(a) Each business tax registration certificate shall be prepared and issued by the Director of Finance and shall state upon the face thereof the following:
1. The name of the person to whom issued.
2. The classification of business engaged in and the section of this article in which the business taxed is described.
3. The address of the location from which the business is conducted, and, where it is different, the mailing address of the business taxed; or where no fixed place of business is maintained, the mailing address of the person to whom the registration certificate has been issued. The mailing address so appearing shall be the address to which all notices required or authorized in this article shall be sent unless the registrant shall request in writing that another address be used for such purpose.
4. The period for which the certificate has been issued.
(b) Each business tax registration certificate shall state on the back thereof the following:
This business tax registration certificate signifies that the person named on the face hereof has fulfilled the requirements of Article 1 of Chapter II of the Los Angeles Municipal Code by registering with the Director of Finance for the purpose of paying business tax for the classification of business for which this certificate is issued. This certificate does not authorize the person to conduct any unlawful business or to conduct any lawful business in an illegal manner or to conduct within the City of Los Angeles the business for which this certificate has been issued without strictly complying with all the provisions of the ordinances of said City, including but not limited to those requiring a permit from any board, commission, department or office of the City. THIS BUSINESS TAX REGISTRATION CERTIFICATE DOES NOT CONSTITUTE A PERMIT. Any failure to comply with the requirements of Article 1 or Article 1.11 of Chapter II of the Los Angeles Municipal Code shall constitute grounds for suspension of this certificate. (Amended by Ord. No. 160,389, Eff. 10/21/85.)
(a) Every person engaged in a business subject to tax under the provisions of this article and which business is conducted at or from a fixed place of business shall keep the registration certificate issued therefor posted in a conspicuous place upon the premises at or from which the business is conducted.
(b) Every person engaged in a business subject to tax under the provisions of this article but not operating from a fixed place of business shall keep the registration certificate issued therefor upon their person at all times while engaging in the business for which it is issued.
(c) Whenever identifying stickers or symbols have been issued for each vehicle, device, machine, or other piece of equipment included in the measure of a business tax, or for each coin-operated machine the gross receipts from which are the measure of the tax, the person to whom such stickers or symbols have been issued shall keep firmly affixed upon each vehicle, device, machine, piece of equipment or coin-operated machine the identifying sticker or symbol which has been issued therefor. Such sticker or symbol shall not be removed from any vehicle, device, machine, piece of equipment or coin-operated machine kept in use, during the period for which the sticker or symbol is issued.
(d) It shall be a misdemeanor for any person to fail to affix as required herein any identifying sticker or symbol to the vehicle, device, machine, piece of equipment, or coin- operated machine for which it has been issued, or to give away, sell or transfer such identifying sticker or symbol to another person, or to permit its use by another person.
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