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MUNICIPAL CODE
FOREWORD
CHAPTER I GENERAL PROVISIONS AND ZONING
CHAPTER 1A CITY OF LOS ANGELES ZONING CODE
CHAPTER II* LICENSES, PERMITS, BUSINESS REGULATIONS
ARTICLE 1 BUSINESS TAXES
SEC. 21.00. DEFINITIONS.
SEC. 21.01. UNLAWFUL BUSINESS NOT AUTHORIZED.
SEC. 21.02. CONSTITUTIONAL EXEMPTIONS.
SEC. 21.03. IMPOSITION OF TAX.
SEC. 21.03.1. AUTOMATIC TAX RATE REDUCTION.
SEC. 21.04. DUE DATES.
SEC. 21.05. DELINQUENT DATES - INTEREST - PENALTIES.
SEC. 21.06. SEPARATE REGISTRATION CERTIFICATE REQUIRED FOR EACH LOCATION AND EACH BUSINESS TAX CLASSIFICATION.
SEC. 21.06.1. SINGLE PRIMARY TAX CLASSIFICATION ELECTION.
SEC. 21.07. REFUNDS OF OVERPAYMENTS.
SEC. 21.08. BUSINESS TAX REGISTRATION CERTIFICATE - FORM.
SEC. 21.09. BUSINESS TAX REGISTRATION CERTIFICATES - POSTING AND KEEPING.
SEC. 21.10. BUSINESS TAX REGISTRATION CERTIFICATES - CHARGE FOR DUPLICATION.
SEC. 21.11. BUSINESS TAX REGISTRATION CERTIFICATE - TRANSFER.
SEC. 21.12. BUSINESS TAX REGISTRATION CERTIFICATES - SUSPENSION.
SEC. 21.13. NEWLY ESTABLISHED BUSINESSES - COMPUTATION OF BUSINESS TAX.
SEC. 21.14. WRITTEN STATEMENTS - WHEN REQUIRED - COMPUTATION OF THE TAX.
SEC. 21.15. DIRECTOR OF FINANCE - DUTY TO ENFORCE - POWERS - RULES AND REGULATIONS.
SEC. 21.16. ASSESSMENT - ADMINISTRATIVE REMEDY.
SEC. 21.16.1. VOLUNTARY DISCLOSURE.
SEC. 21.17. CONFIDENTIAL CHARACTER OF INFORMATION OBTAINED - DISCLOSURE UNLAWFUL.
SEC. 21.18. DELINQUENT TAXES - INSTALLMENT PAYMENT.
SEC. 21.19. DELINQUENT TAXES - SUIT FOR RECOVERY.
SEC. 21.20. DELINQUENT TAXES - DEBT NOT DISCHARGED BY PENAL CONVICTION.
SEC. 21.21. DELINQUENT TAXES - UNCOLLECTIBLE.
SEC. 21.22. RELIGIOUS, CHARITY, ETC.; PROCEDURE FOR ISSUANCE OF TAX EXEMPT REGISTRATION CERTIFICATES.
SEC. 21.23. EFFECT OF REPEALS AND AMENDMENTS.
SEC. 21.24. EXEMPTION FOR PERSONS HAVING EQUAL OR GREATER PAYROLL EXPENSE TAX LIABILITY.
SEC. 21.25. RELIEF FOR EARTHQUAKE INTERRUPTION.
SEC. 21.26. EMPOWERMENT ZONE - CITY BUSINESS TAX REDUCTIONS, LIMITATIONS, AND EXEMPTIONS.
SEC. 21.27. ENTERTAINMENT AND MULTIMEDIA BUSINESS TAX LIMITATIONS.
SEC. 21.28. FISCAL YEAR REPORTING.
SEC. 21.29. SMALL BUSINESS EXEMPTION.
SEC. 21.30. NEW BUSINESS EXEMPTION.
SEC. 21.31. SETTLEMENT BUREAU.
SEC. 21.32. REWARDS FOR INFORMATION.
SEC. 21.33. [TAX RATES.]
SEC. 21.41. GROSS RECEIPTS FUND CLASS 1.
SEC. 21.42. GROSS RECEIPTS FUND CLASS 2.
SEC. 21.43. GROSS RECEIPTS FUND CLASS 2.
SEC. 21.44. GROSS RECEIPTS FUND CLASS 4.
SEC. 21.45. GROSS RECEIPTS FUND CLASS 5.
SEC. 21.46. GROSS RECEIPTS FUND CLASS 6.
SEC. 21.47. GROSS RECEIPTS FUND CLASS 7.
SEC. 21.48. GROSS RECEIPTS FUND CLASS 8.
SEC. 21.49. GROSS RECEIPTS FUND CLASS 9.
SEC. 21.50. TAXATION OF MEDICAL MARIJUANA COLLECTIVES.
SEC. 21.51. TAXATION OF CANNABIS.
SEC. 21.52. TAXATION OF MEDICAL CANNABIS.
SEC. 21.53. AMUSEMENT PARK.
SEC. 21.55. AUCTIONEER.
SEC. 21.56. AUTO PARK
SEC. 21.59. BASEBALL, FOOTBALL, ETC.
SEC. 21.62. BILLIARDS, ETC.
SEC. 21.63. AMUSEMENT MACHINES.
SEC. 21.64. COIN-OPERATED PHONOGRAPHS AND MUSIC MACHINES.
SEC. 21.65. VENDING MACHINES.
SEC. 21.65.1. COIN-OPERATED SCALES AND SERVICE MACHINES.
SEC. 21.70. BOWLING ALLEY, SKEE-BALL SHUFFLEBOARD, ETC.
SEC. 21.74. CIRCUSES.
SEC. 21.75. SIDE SHOWS, CARNIVALS, CONCESSIONS.
SEC. 21.78. COLLECTION AGENCIES.
SEC. 21.79. COMMISSION BROKERS.
SEC. 21.80. INDEPENDENT TELEMARKETING AGENCY.
SEC. 21.83. DANCE HALL.
SEC. 21.85. PUBLIC DANCE.
SEC. 21.94. RIDES.
SEC. 21.98. OFFICE COMMERCIAL BUILDINGS, ETC., RENTALS.
SEC. 21.98.1. SWAP MEET OPERATOR.
SEC. 21.98.2. ANTIQUE SHOW AND COLLECTORS’ EXCHANGE SHOW PROMOTER.
SEC. 21.99. RENTING ACCOMMODATIONS.
SEC. 21.102. LAUNDRY, CLEANING AND DYEING AGENT, COLLECTOR, LINEN SUPPLY, SHOE REPAIR.
SEC. 21.108. MONEY LENDERS.
SEC. 21.109. MOTION PICTURE, TELEVISION AND RADIO PRODUCERS.
SEC. 21.124. OIL WELLS.
SEC. 21.141. WAREHOUSE - STORAGE OF GOODS.
SEC. 21.142. STEVEDORES.
SEC. 21.143. TUGBOAT AND BARGE OPERATORS.
SEC. 21.147. THEATRE.
SEC. 21.166. MERCHANDISE WHOLESALE SELLING.
SEC. 21.167. MERCHANDISE - RETAIL SELLING.
SEC. 21.167.1. SALES OF FIREARMS AND AMMUNITION.
SEC. 21.168.1. OUT OF STATE SALES.
SEC. 21.168.2. SALE FOR CONVENIENCE.
SEC. 21.168.3. CERTAIN SOLICITORS DEEMED EMPLOYEES.
SEC. 21.168.4. EXEMPTION - TEMPORARY EXHIBITORS AT TRADESHOWS.
SEC. 21.168.5. CERTIFIED PRODUCERS DEEMED EMPLOYEES.
SEC. 21.169. CHRISTMAS TREES.
SEC. 21.170. CHRISTMAS TREE LOT CLEAN-UP DEPOSITS.
SEC. 21.171. RETAILERS OF NEW PASSENGER MOTOR VEHICLES.
SEC. 21.187. COMMON CARRIER BUS.
SEC. 21.188. CONTRACTORS.
SEC. 21.189.1. MISCELLANEOUS SERVICES.
SEC. 21.189.2. RADIO AND TELEVISION BROADCASTER.
SEC. 21.189.3. CHILD CARE PROVIDERS.
SEC. 21.189.4. MULTIMEDIA BUSINESSES.
SEC. 21.190. PROFESSIONS AND OCCUPATIONS.
SEC. 21.190.1. EXEMPTION.
SEC. 21.191. HEALTH MAINTENANCE ORGANIZATIONS.
SEC. 21.192. PERSONAL PROPERTY RENTAL.
SEC. 21.192.1. RENTAL - OUT OF STATE PROPERTY.
SEC. 21.193. SALE OF REAL PROPERTY.
SEC. 21.194. TRANSPORTING PERSONS FOR HIRE.
SEC. 21.195. TRUCKING - HAULING
SEC. 21.196. MISCELLANEOUS TRUCKING.
SEC. 21.197. TELEPHONE COMPANIES.
SEC. 21.199. SALES TAX.
ARTICLE 1.1 TELEPHONE, ELECTRICITY AND GAS USERS TAX
ARTICLE 1.2 1984 OLYMPIC GAMES TICKET DISTRIBUTION TAX
ARTICLE 1.3 COMMERCIAL TENANT’S OCCUPANCY TAX
ARTICLE 1.5 USE TAX [Suspended]
ARTICLE 1.6 UNIFORM SALES AND USE TAX
ARTICLE 1.7 TRANSIENT OCCUPANCY TAX
ARTICLE 1.8 CIGARETTE TAX ORDINANCE
ARTICLE 1.9 REAL PROPERTY TRANSFER TAX
ARTICLE 1.10 DWELLING UNIT CONSTRUCTION TAX
ARTICLE 1.11 PAYROLL EXPENSE TAX
ARTICLE 1.12 TAX PENALTY AMNESTY OF 2020
ARTICLE 1.13 RESIDENTIAL DEVELOPMENT TAX
ARTICLE 1.14 SPECIAL FIRE SAFETY AND PARAMEDIC COMMUNICATIONS EQUIPMENT TAX
ARTICLE 1.15 PARKING OCCUPANCY TAX
ARTICLE 1.16 SPECIAL POLICE COMMUNICATIONS / 911 SYSTEM TAX
ARTICLE 1.17 ENTERPRISE ZONE HIRING TAX CREDIT VOUCHER APPLICATION FEES
ARTICLE 2 DEFINITIONS - AUTHORITY AND PROCEDURE - REVOCATION OF PERMITS
ARTICLE 6 BICYCLES AND VEHICLES
ARTICLE 8 ADVERTISING
ARTICLE 9 REPOSSESSION OF MOTOR VEHICLES - PERMIT REQUIREMENTS
CHAPTER III PUBLIC HEALTH CODE
CHAPTER IV PUBLIC WELFARE
CHAPTER V PUBLIC SAFETY AND PROTECTION
CHAPTER VI PUBLIC WORKS AND PROPERTY
CHAPTER VII TRANSPORTATION
CHAPTER VIII TRAFFIC
CHAPTER IX BUILDING REGULATIONS
CHAPTER X BUSINESS REGULATIONS
CHAPTER XI NOISE REGULATION
CHAPTER XII THE WATER CONSERVATION PLAN OF THE CITY OF LOS ANGELES
CHAPTER XIII THE EMERGENCY ENERGY CURTAILMENT PLAN OF THE CITY OF LOS ANGELES
CHAPTER XV RENT STABILIZATION ORDINANCE
CHAPTER XVI HOUSING REGULATIONS
CHAPTER XVII RULES AND REGULATIONS GOVERNING THE USE OF THE LOS ANGELES AIRPORTS
CHAPTER XVIII EMPLOYEE WAGES AND PROTECTIONS
CHAPTER XIX ENVIRONMENTAL PROTECTION
CHAPTER XX COVID-19 PROTECTION AND RECOVERY*
TABLES
Los Angeles Planning and Zoning
Chapter 1A City of Los Angeles Zoning Code
Table of Amending Legislation for Chapter 1A
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SEC. 21.11. BUSINESS TAX REGISTRATION CERTIFICATE —TRANSFER.
 
   No registration certificate shall be transferable except where the business taxed is transferred, whether by sale or otherwise, to another person under such circumstances that the real or ultimate ownership of the business after the transfer is substantially similar to the real or ultimate ownership existing before the transfer. For the purposes of this section, stockholders, bond-holders, partners, or other persons holding an interest in a corporation or other entity herein defined to be a person are regarded as having the real or ultimate ownership of such corporation or other entity.
 
SEC. 21.12. BUSINESS TAX REGISTRATION CERTIFICATES —SUSPENSION.
   (Title and Section Amended by Ord. No. 160,389, Eff. 10/21/85.)
 
   (a)   Whenever any person fails to comply with any provision of this article pertaining to business tax or Article 1.11 of this chapter pertaining to payroll expense tax, or any rule or regulation adopted pursuant thereto, the Director of Finance, upon hearing, after giving such person ten days’ notice in writing specifying the time and place of hearing and requiring the person to show cause why their registration certificate or certificates should not be suspended, may suspend any one or more of the registration certificates held by such person. The notice shall be served in the same manner as notices of assessment are served under Section 21.16 of this article.
 
   (b)   Any person who engages in any business after the registration certificate issued therefor has been suspended, and before such suspended certificate has been reinstated, shall be guilty of a misdemeanor.
 
 
SEC. 21.13. NEWLY ESTABLISHED BUSINESSES – COMPUTATION OF BUSINESS TAX.
(Amended by Ord. No. 177,246, Eff. 2/18/06, Oper. 1/1/06.)
 
   (a)   Except in cases where this article prescribes a different method to compute and pay the business tax for a newly established business, the business tax shall be obtained and paid in accordance with whichever of the following applies to the classification of newly established business:
 
   1.   When the annual business tax is measured by any of the following: gross receipts, gross production costs and gross receipts, gross cost of the work done, or gross receipts and salaries, wages, fees or other compensation paid, the applicant for a business tax registration certificate shall at the time of making application, pay a minimum amount of tax that will apply for the first year of operation. This minimum tax cannot be pro-rated. At the end of the business tax period, the taxpayer shall file a written statement as prescribed in Section 21.14 disclosing all the particulars required for the classification of that business. At the time of renewal, the taxpayer shall pay the actual tax owed for the first year of operation deducting any minimum tax previously paid for that year. This additional tax is computed at the current rate specified for the classification of that particular business. This tax is then measured and paid in the manner prescribed in Section 21.14. In all cases, the business tax shall be determined and paid in all business tax periods subsequent to the first business tax periods in the manner prescribed in Section 21.14.
 
   2.   When the annual business tax is measured by any of the following: the number of vehicles, machines, devices or articles of equipment used, the number of persons employed, square foot area, seating capacity, the scale of fees or other charges collected, the applicant for a business tax registration certificate shall file with the Director of Finance, a statement setting forth the applicable factors in use, expected to be in use, employed, or collected. The taxpayer is required to pay the business tax at the time of making the application when the business is started. The required application and the tax payment is due as follows: when the business tax period is daily, tax is due on or before the close of business on the day on which the business was started; when the business tax period is monthly or quarterly, the tax is due on or before the last day of the month in which the business was started; when the business tax period is annual, the tax is due on or before the last day of the month following the month in which the business was started. After the start of the business, the factor by which the tax is measured is increased in the first business tax period, an additional amount of tax becomes due, and this increase shall be reported and the additional amount of business tax paid in accordance with the provisions of Section 21.14. Business taxes in these cases for subsequent business tax periods shall be paid in accordance with the provisions of Section 21.14.
 
   3.   (i)   When the provisions of this article impose a flat rate tax for a business tax period or a fractional part of a period, the applicant of a business tax registration certificate for a newly established business shall pay the business tax required at the time the application is made, without proration for any portion of the business tax period expired at the time the business started.
 
   (ii)   When the provisions of this article impose a flat rate tax for a business tax period without the requirement that the full amount of the tax be paid for the business tax period or any fractional part of the period, the applicant for a business tax registration certificate for a newly established business shall, at the time the application is made, pay the business tax required to be paid prorated for the even monthly portion of the business tax period, which is unexpired at the time the business is started.
 
   (b)   Except as otherwise provided in the foregoing cases, application by a newly established business for a business tax registration certificate and payment of the required business tax shall be made as follows: whenever the business tax period is daily, on or before the close of business on the day on which the business is started; whenever the business tax period is monthly or quarterly, on or before the last day of the month in which the business is started; whenever the business tax period is annual, on or before the last day of the month following the month in which the business started. In these cases, the business tax for subsequent business tax periods shall be paid when due and prior to the delinquency date provided in Section 21.05.
 
 
SEC. 21.14. WRITTEN STATEMENTS – WHEN REQUIRED – COMPUTATION OF THE TAX.
 
   (a)   Except where a provision of this article specifically provides a different method for the filing of a statement and payment of the business tax for a designated classification of business, statements required hereunder shall be filed and payment of the tax made in the following manner:
 
   1.   Whenever an annual business tax is measured by gross receipts, gross cost of production and gross receipts, gross cost of the work done, or gross receipts and salaries, wages, fees or other compensation paid, the person subject to the business tax shall, before the tax becomes delinquent, file with the Director of Finance a written statement setting forth whichever of the following is applicable to the classification of business being engaged in: The gross receipts of the preceding year; the gross cost of production and gross receipts of the preceding year; the gross cost of the work done in the preceding year; or gross receipts and salaries, wages, fees or other compensation paid in the preceding year; and such person shall pay at such time the amount of the business tax computed upon the measure of the tax reported in the statement.
 
   2.   Whenever a quarterly business tax is imposed upon the number of oil wells operated and the number of barrels of oil produced, the person subject to the tax shall, before the business tax for each quarter becomes delinquent, file with the Director of Finance a written statement setting forth the number of wells in operation and the number of barrels of oil produced by each well in the preceding calendar quarter and such person shall pay at such time the amount of the business tax computed upon the measure of the tax reported in the statement.
 
   3.   Whenever the business tax is measured by the number of vehicles, machines, devices, tables, articles of equipment used or persons employed, or whenever the business tax is measured by square foot area, seating capacity, the scale of fees or other charges collected, the person subject to the tax shall before the tax becomes delinquent file with the Director of Finance a written statement setting forth the then applicable factor or factors that constitute the measure of the tax and shall pay at such time the amount of the business tax computed thereon. In each case where the factor by which the tax is measured is increased during the business tax period and an additional amount of business tax becomes due, the person subject to the tax shall notify the Director of Finance and pay the additional tax due in the following manner: When the business tax period is daily, on the day the increase occurs; when the business tax period is monthly or quarterly, within 30 days of the date on which the increase occurred; when the business tax period is annual, on or before the last day of the month following the month in which the increase occurred.
 
   (b)   The written statements shall be made upon forms prescribed by the Director of Finance and shall include a declaration substantially as follows:
 
   “I declare, under penalty of making a false declaration, that I am authorized to make this statement, and that to the best of my knowledge and belief it is a true, correct and complete statement made in good faith for the period stated, in compliance with the provisions of the Los Angeles Municipal Code.”
 
   (c)   Such statements shall not be conclusive against the City as to the information set forth therein, nor shall the filing of a statement preclude the City from collecting by appropriate action any additional tax that is later determined to be due and payable under the provisions of this article.
 
   (d)   The Director of Finance and all of the Director’s deputies shall have the power and authority to require the person subject to the tax to provide any other information including a list of subcontractors, vendors and tenants that will help enforce the business tax. The operative date of this [sub]section will be January 1, 2005. (Added by Ord. No. 177,216, Eff. 2/8/06.)
 
 
SEC. 21.15. DIRECTOR OF FINANCE – DUTY TO ENFORCE – POWERS – RULES AND REGULATIONS.
 
   (a)   Duty to Enforce. It shall be the duty of the Director of Finance, and the Director of Finance is hereby directed, to enforce each and all of the provisions of this article and Article 1.5, and the Chief of Police shall render such assistance in the enforcement of this article and Article 1.5 as may from time to time be required by the Director of Finance.
 
   (b)   Inspection and Examination of Places of Business. The Director of Finance in the exercise of the duties imposed upon the Director, and acting through the Director’s deputies, shall inspect and examine all places of business in the City to ascertain whether or not the provisions of this article and Article 1.5 have been complied with.
 
   (c)   Audit and Examination of Records and Equipment. The Director of Finance and the City Controller, and deputies of each of them, shall have the power to audit and examine all books and records, and, where necessary, all equipment, of any person engaged in business in the City for the purpose of ascertaining the amount of business tax, sales or use tax, if any, required to be paid by the provisions hereof, and for the purpose of verifying the statements, or any item thereof, when filed by any taxpayer pursuant to the provisions of Secs. 21.13, 21.14 or 21.199, or Article 1.5. If such person, after written demand by the Director of Finance or City Controller, or a deputy of either, refuses to make available for audit, examination or verification such books, records or equipment as the Director of Finance, City Controller, or deputy of either, requests, the Director of Finance may, after full consideration of all information within the Director’s knowledge concerning the business and activities of the person so refusing, make an assessment in the manner provided in Sec. 21.16 of any taxes estimated to be due.
 
   (d)   Inspection of Registration Certificates, etc. The Director of Finance and all of the Director’s deputies shall have the power and authority to enter, free of charge, during business hours, any place of business required to be registered and taxed by the provisions of this article or Article 1.5, and to demand exhibition of a business registration certificate and sales or use tax permit and evidence of amount of tax paid. Any person having any such business tax registration certificate, or sales or use tax permit, heretofore issued in the person’s possession or under the person’s control who fails to exhibit the same as well as evidence of amounts of tax paid on demand shall be guilty of a misdemeanor and subject to the penalty provided for by the provisions of this Code.
 
   (e)   Extensions of Time for Filing. The Director of Finance may upon receipt of the written request of a taxpayer, and for good cause, extend the time for filing any statement required under the provisions of Section 21.13, 21.14 or 21.199, or Article 1.5 for a period of not to exceed 45 days, provided that the time for filing the required statement has not already passed when the request is received. No penalty for delinquent payment shall accrue by reason of such extension if 90% or more of the total tax due is paid prior to the tax becoming delinquent. If less than 90% of the total tax due is paid prior to the tax becoming delinquent, a twenty percent (20%) penalty on any unpaid principal tax balance shall accrue. Interest shall accrue during said extension in the manner provided herein. (Amended by Ord. No. 176,160, Eff. 9/25/04.)
 
   (f)   Compromise of Claims. The Director of Finance, subject to the provisions of the Charter, may compromise a claim for business tax where the portion of the claim proposed to be released is equal to or less than the monetary limitations set forth in Section 22.13, as adjusted by the Controller in accordance with Subsection (e) of that section. Compromise of claims in excess of $15,000.00, requires the written approval of the City Attorney. The Director of Finance is further authorized to enter into releases of the approved compromises subject to the approval of the City Attorney. (Amended by Ord. No. 179,984, Eff. 8/3/08.)
 
   (g)   Minor Error in Payment. In the event a discrepancy exists between the amount of tax paid and the amount of tax due under this Article or Article 1.6, resulting in the underpayment or overpayment of the tax in an amount of $30.00 or less, the Director of Finance may accept and record the underpayment or overpayment without other notification to the taxpayer. (Amended by Ord. No. 181,860, Eff. 9/29/11.)
 
   (h)   Rules and RegulationsApportionment. The Director of Finance may make such rules and regulations as are not inconsistent with the provisions of this article or Article 1.5 as may be necessary or desirable to aid in the enforcement of the provisions of this article and Article 1.5. When, by reason of the provisions of the Constitution of the United States or the Constitution of California, the business tax imposed by this article cannot be enforced without there being an apportionment according to the amount of business done in the City of Los Angeles, or in the State of California, as the case may be, the Director of Finance may make such rules and regulations for the apportionment of the tax as are necessary or desirable to overcome the constitutional objections. Such rules and regulations shall be approved by the City Attorney prior to becoming effective.
 
   (i)   Deficiency Determinations. If the Director of Finance is not satisfied that any statement filed as required under the provisions of this article or Article 1.5 of Chapter 2 of this Code is correct, or that the amount of tax is correctly computed, the Director of Finance may compute and determine the amount to be paid and make a deficiency determination upon the basis of the facts contained in the statement or upon the basis of any information in the Director’s possession or that may come into the Director’s possession. One or more deficiency determinations of the amount of tax due for a period or periods may be made. When a person discontinues engaging in a business, a deficiency determination may be made at any time within three years thereafter as to any liability arising from engaging in such business whether or not a deficiency determination is issued prior to the date the tax would otherwise be due. Whenever a deficiency determination is made, a notice shall be given to the person concerned in the same manner as notices of assessment are given under Sec. 21.16.
 
   (j)   Payments, etc., Made by Mail. Whenever any payment, statement, report, request or other communication received by the Director of Finance is received after the time prescribed by this article or Article 1.5 for the receipt thereof, but is in an envelope bearing a postmark showing that it was mailed prior to the time prescribed in this article or Article 1.5 for the receipt thereof, or whenever the Director of Finance is furnished substantial proof that the payment, statement, report, or request for other communication was in fact deposited in the United States mail prior to the time prescribed for receipt thereof, the Director of Finance may regard such payment, statement, report, request or other communication as having been timely received.
 
   (k)   Earthquake Related Extension. Upon the receipt on or before August 31, 1994 of the written request of a taxpayer showing that such taxpayer’s business has been impacted by the earthquake of January 17, 1994 to the extent of preventing the filing of any statement required under the provisions of Sections 21.13 or 21.14 or Article 1.11 of this Code or the payment of any tax required in connection therewith for such business prior to the delinquency date, the Director of Finance shall extend the delinquency rate for filing any such statement and paying any such tax for such business to September 1, 1994. No penalty or interest shall accrue prior to September 1, 1994 by virtue of such extension of the delinquency date. The relief provided in this subsection shall be an alternative to the relief provided in Subsection (e) of this section and not in addition thereto, and shall be applicable only to annual taxes due in 1994. (Amended by Ord. No. 169,853, Eff. 7/4/94, Oper. 2/28/94.)
 
   (l)   Requirement of Payments by Electronic Funds Transfer. All tax payments in the amount of fifty thousand dollars ($50,000) or more shall be paid via a financial institution’s electronic funds transfer. (Added by Ord. No. 176,160, Eff. 9/25/04.)
 
   (m)   Credit Card Transaction Fee for On-line Payment. Every person who files their renewal online and pays their business tax with a credit card shall pay a transaction fee in the amount of $3.00. The purpose of this fee is to offset a portion of the administrative costs incurred by the City for those transactions. (Added by Ord. No. 180,358, Eff. 12/20/08.)
 
   (n)   Public Disclosure of Tax Delinquencies. (Added by Ord. No. 180,378, Eff. 1/4/09.)
 
   (i)   Notwithstanding any other provision of law, the Director of the Office of Finance shall make available as a matter of public record each calendar quarter a list of the largest 250 tax delinquencies in excess of one hundred thousand dollars ($100,000.00) under this part. For purposes of compiling the list, a “tax delinquency” means an amount owed to the City of Los Angeles as to which all of the following apply:
 
   (A)   That has been submitted to the Director of Finance for a finding that the delinquent tax is unpaid and the administrative process has been completed pursuant to Los Angeles Municipal Code Section 21.16.
 
   (B)   The amount of tax has been delinquent for more than ninety (90) days.
 
   (C)   For purposes of the list, a tax delinquency does not include any delinquency that would be uncollectible by operation of law.
 
   (ii)   Each quarterly list shall include all of the following with respect to each delinquency:
 
   (A)   The name of the person or persons liable for payment of the tax and the person’s or persons’ last known business address.
 
   (B)   The amount of tax delinquency as shown on the notice or notices of the tax delinquency and any applicable interest or penalties, less any amounts paid.
 
   (C)   The type of tax that is delinquent.
 
   (iii)   Prior to making a tax delinquency a matter of public record as required by this section, the Director of Finance shall provide a preliminary written notice to the person or persons liable for the tax by certified mail, return receipt requested, demanding payment of the amount owed and informing the person or persons that nonpayment may result in the tax delinquency being made a matter of public record. If within 30 days after issuance of the notice, the person or persons do not remit the amount due or make arrangements with the Director of Finance for payment of the amount due, the tax delinquency shall be included on the list.
 
   (iv)   The quarterly list described in subsection (n)(i) shall include the telephone number and address of the Office of Finance in order to provide a point of contact if a person believes the placement of the person’s name on the list is in error.
 
   (v)   A person whose delinquency appears on the quarterly list, and who satisfies that delinquency in whole or in part, may request the Director of Finance to include in the quarterly list any payments that person made to satisfy the delinquency. Upon receipt of that request, the Director of Finance may include those payments on the list as promptly as feasible.
 
   (o)   Liens for Unpaid Taxes. (Added by Ord. No. 181,238, Eff. 9/12/10.)
 
   (i)   The amount of any tax, interest and penalty imposed by this Chapter shall be deemed a debt to the city. If the tax is not paid when due, such tax, penalty and interest shall be a lien against the taxpayer’s property for the amount thereof, which lien shall continue until the amount thereof including all penalties and interest are paid, or until it is discharged of record.
 
   (ii)   The Director of Finance may record liens against property to collect unpaid taxes, interest, and penalties upon the exhaustion of the administrative process to determine the amount of such liabilities under this Chapter. Such liens may be recorded against real property used in connection with activities that generated the tax liability or against personal property used in connection with activities that generated the tax liability. Such liens shall be recorded according to applicable law in the jurisdiction in which the property is located.
 
   (iii)   Prior to recording a lien for unpaid taxes, interest, and penalties, the Director of Finance shall provide a report requesting approval of the lien to the City Council, with the taxpayer’s name, amount of tax, interest, and penalties owed, and the tax periods for which taxes will be collected. The report shall be referred by the City Clerk to the full City Council without referral to any Council Committee, and duly placed upon the agenda of the City Council. No request for approval of a lien shall be made to the City Council unless the City Attorney has determined that a sufficient basis exists to support the liability and that assets exist to which the liability could attach. The Director of Finance shall provide at least 15 days notice of the hearing before the City Council to the taxpayer by mailing a copy of the report to the address contained in the most recent records of the Office of Finance. Notice shall be deemed complete at the time of deposit in the United States mail. (Amended by Ord. No. 182,111, Eff. 5/29/12.)
 
   (iv)   Upon a majority vote by the City Council to approve the recordation of lien(s), the Director of Finance or the Director’s designee may record in the proper office a certificate which specifies the amount of tax, interest and penalties due, the name and last known address of the person liable for the same, a statement that the Director of Finance has determined the correct amount to be paid and a legal description of the property owned by the taxpayer to which the lien applies. From the time of the recording of the certificate, the amount required to be paid together with interest and penalties constitutes a lien upon all property to which the lien can attach and to property owned by the taxpayer used in connection with activities subject to taxation under this Chapter. The lien has the force, effect and priority of a state tax lien and shall continue for ten (10) years from the filing of the certificate unless sooner released or otherwise discharged, or unless a term is otherwise provided by applicable law.
 
 
SEC. 21.16. ASSESSMENT — ADMINISTRATIVE REMEDY.
   (Amended by Ord. No. 138,968, Eff. 8/9/69.)
 
   (a)   Assessment of taxes. (Amended by Ord. No. 181,857, Eff. 10/4/11.)
 
   (1)   Whenever the Director of Finance determines that any tax is due or may be due to the City of Los Angeles under the provisions of this chapter, the Director of Finance may at any time make and give notice of an assessment of such tax; however, the period during which the Director of Finance may make and give notice of an assessment of tax is limited as follows:
 
   (A)   When a person timely files an application for a business tax registration certificate or business tax renewal form for a business subject to tax under Article 1 of Chapter 2 of this Code, the Director of Finance may make and give notice of an assessment of tax at any time within three years of the date on which such taxes were due under this Code;
 
   (B)   When a person timely files an application for a business tax registration certificate or business tax renewal form for a business subject to tax under Article 1 of Chapter 2 of this Code, the Director of Finance may make and give notice of an assessment of tax at any time within six years of the date on which such taxes were due under this Code if there is a substantial understatement of the amount of tax due on the business tax registration certificate application or business tax renewal form. For purposes of this subsection:
 
   (i)   The “tax due” on the business tax registration certificate application or business tax renewal form is the amount of tax properly due from the taxpayer for the period(s) encompassed by the business tax registration certificate application or business tax renewal form;
 
   (ii)   A “substantial understatement” occurs when a taxpayer fails to report some of the tax due, and the omitted amount is 25% or more of the amount of tax reported in the business tax registration certificate application or business tax renewal form;
 
   (iii)   The filing of an amended business tax registration certificate application or an amended business tax renewal form does not reduce the time period in which the Director of Finance may make an assessment under this subsection;
 
   (iv)   The taxpayer’s subjective or objective state of mind is irrelevant in determining whether a substantial understatement exists;
 
   (C)   When a person files an untimely business tax registration certificate application or an untimely business tax renewal form for a business subject to tax under Article 1 of Chapter 2 of this Code, the Director of Finance may make and give notice of an assessment of tax at any time within three years of the date on which the untimely business tax registration certificate application or untimely business tax renewal form was filed;
 
   (D)   When a person makes a willful attempt in any manner to defeat or evade a tax imposed under Article 1 of Chapter 2 of this Code, including the filing of a false business tax registration certificate application or business tax renewal form or the filing of such a form with the willful intent to evade a tax, the Director of Finance may make and give notice of an assessment of tax at any time;
 
   (E)   In all other circumstances, including the collection of any tax other than those set forth under Article 1 of Chapter 2 of this Code, the Director of Finance may make and give notice of an assessment at any time otherwise allowed by law;
 
   (F)   If more than one of these circumstances applies, the Director of Finance shall have the longest applicable period in which to make and give notice of an assessment.
 
   (2)   The notice of assessment shall separately set forth the amount of any tax known by the Director of Finance to be due or estimated by the Director of Finance, after full consideration of all information within the Director’s knowledge concerning the business and activities of the person assessed, to be due under each applicable section of this chapter and shall include the amount of any penalties or interest accrued on each amount to the date of the notice of assessment.
 
   (b)   Service of assessment; right to hearing. (Amended by Ord. No. 181,857, Eff. 10/4/11.) The notice of assessment shall be served upon the person either by handing it to the person personally, or by a deposit of the notice in the United States mail, postage prepaid thereon, addressed to the person at the address of the location of the business appearing on the face of the registration certificate issued to the person or to such other address as the person shall register with the Director of Finance for the purpose of receiving notices provided under this chapter; should the person have no registration certificate issued to the person and should the person have no address registered with the Director of Finance for such purpose, then to such person’s last known address. For the purpose of this section, a service by mail is complete at the time of deposit in the United States mail. Within 45 days after the date of service, the person assessed may either apply in writing to the Director of Finance for a hearing on the assessment or may file a written request that such hearing be waived. If the person neither requests a hearing upon the assessment nor requests a waiver of hearing within the prescribed time, the amount of the assessment shall be final and the amount thereof shall immediately be due and owing to the City of Los Angeles, but penalties and interest as provided by this chapter shall continue to accrue until paid.
 
   (c)   Waiver of hearing. If the person requests that the hearing be waived, the Director of Finance may either grant such request and notify the person thereof in writing or may, in the Director’s discretion, deny the request and set the assessment for hearing at the time and in the manner prescribed by Subsection (d) hereof. If the Director of Finance grants the request for waiver of hearing, the administrative proceedings prescribed by this section shall be deemed exhausted and the City shall have the right to bring an action in any court of competent jurisdiction to collect the amount of the assessment, plus such penalties and interest as may have accrued thereon as provided by this chapter.
 
   (d)   Time of hearing; notice. (Amended by Ord. No. 174,084*, Eff. 8/19/01.) If the person requests a hearing upon the assessment or if the Director of Finance denies the person’s request for waiver of hearing, the Director of Finance shall cause the matter to be set for hearing before an Assessment Review Officer not later than 90 days after the date of the application, or, as the case may be, the date of the Director of Finance’s denial of the waiver of hearing. A request for hearing shall be accompanied by a written statement of the basis or bases for the request. Notice of the time and place of the hearing shall be mailed by the Director of Finance to the person assessed not later than 15 days before the date set for hearing and, if the Director of Finance desires said person to produce specific records at such hearing, such notice may designate the records requested to be produced.
 
   (e)   Administrative hearing. (Amended by Ord. No. 174,084*, Eff. 8/19/01.) The hearing prescribed by this section shall be before an Assessment Review Officer. The Assessment Review Officer shall be appointed by the Director of Finance and shall be an employee of the Office of Finance. At the hearing, the person assessed and the representative of the Director of Finance, who shall be a person other than the Assessment Review Officer, may submit such evidence as they believe to be relevant to their respective positions. The Assessment Review Officer may require the presentation of additional evidence from either the person assessed or the representative of the Director of Finance, or from both, and may continue the hearing from time to time for the purpose of allowing the presentation of additional evidence.
 
   (f)   Decision of Assessment Review Officer. (Amended by Ord. No. 174,084*, Eff. 8/19/01.) Upon completion of the hearing, the Assessment Review Officer may (i) affirm the assessment, (ii) increase the assessment, or (iii) decrease the assessment, as the evidence may require; but the amount of the assessment shall not be increased unless the claim for the increase is asserted on behalf of the City either before or during the hearing. Written notice of the decision of the Assessment Review Officer shall be given to the person assessed in the same form and in the same manner as the notice of assessment.
 
   (g)   Optional Office of Finance Appeals. (Amended by Ord. No. 177,019, Eff. 11/14/05.) The Office of Finance may, at its discretion, establish one or more advisory bodies, which may be composed of City staff and members of the public, including members of the business community, to hear appeals from decisions of the Assessment Review Officer. If the Office of Finance does establish one or more boards and the person assessed does not appeal, the person shall nevertheless be deemed to have exhausted the administrative proceedings provided by this section.
 
   (h)   Hearing Before Board of Review. (Amended by Ord. No. 174,084*, Eff. 8/19/01.) At the hearing before the Board of Review, the appellant and the representative of the Director of Finance, who shall be a person other than a member of the Board of Review, may submit such evidence and argument as they believe to be relevant to their respective positions. The Board of Review may require the presentation of additional evidence or argument, or both, from either the appellant or the representative of the Director of Finance, or from both, and may continue the hearing from time to time for the purpose of allowing the presentation of additional evidence or argument, or both.
 
   (i)   Determination by Board of Review. (Amended by Ord. No. 181,858, Eff. 10/4/11.)
 
   (1)   Upon completion of the hearing, the Board of Review may, by majority vote of its members, affirm or decrease the assessment, as the evidence may require. The assessment shall be final and the administrative review process shall be complete when the Board of Review issues its determination. Written notice of the determination of the Board of Review shall be given to the appellant in the same form and in the same manner as the notice of assessment.
 
   (2)   The Board of Review shall not affirm an assessment under the following circumstances:
 
   (A)   The taxpayer has a previous Board of Review determination. A “previous Board of Review determination” means an earlier determination by a Board of Review created under Sec. 21.16 of this Code or a predecessor or successor ordinance, and refers to the previous Board of Review determination that most recently addressed the item that is currently in dispute;
 
   (B)   The previous Board of Review determination resulted in a written determination specifically stating that the taxpayer earned revenues under one or more Gross Receipts Fund Class or Classes (as defined Municipal Code Secs. 21.41 through 21.49, inclusive, or their predecessors or successors), after reviewing the results of an audit by the Office of Finance in which the taxpayer provided full and complete cooperation;
 
   (C)   The assessment that is proposed to be affirmed would result in higher business tax liabilities than those self-reported by the taxpayer solely because of one or more changes from the Gross Receipts Fund Class specifically stated in the previous Board of Review determination or determinations, and the taxpayer provided full and complete cooperation to the Office of Finance in the audit resulting in the assessment proposed to be affirmed;
 
   (D)   The business model and method of operations of the taxpayer were exactly the same with respect to the previous Board of Review determination or determinations as before the Board of Review proceeding that resulted in the assessment that is proposed to be affirmed, and in both circumstances the taxpayer fully reported its gross receipts; and
 
   (E)   Nothing precluded the Office of Finance from conducting a full and complete audit of the taxpayer both prior to the previous Board of Review determination or determinations and with respect to the audit resulting in the assessment that is proposed to be affirmed.
 
   (3)   When a determination (or determinations) made by a previous Board of Review with respect to a taxpayer’s Gross Receipts Fund Class is overturned by a subsequent Board of Review determination, the change(s) to the taxpayer’s Gross Receipts Fund Class or Classes shall apply to the first full tax year beginning after the year in which an assessment is not affirmed by the Board of Review pursuant to Subsection 21.16(i)(2).
 
   (4)   Should a taxpayer wish to challenge a Board of Review determination regarding business classification that would otherwise be negated by operation of Subsection 21.16(i)(2), the taxpayer shall notify the Board of Review via certified mail that must be postmarked within 15 days from the date of service of the notice of decision of the Board of Review. If the taxpayer provides notice under Subsection 21.16(i)(4), no assessment shall be negated by operation of Subsection 21.16(i)(2). The taxpayer may then proceed under the normal procedures for challenging assessments set forth in this Code and California Law. If the taxpayer does not provide notice under Subsection 21.16(i)(4) that it wishes to challenge a Board of Review determination that would otherwise not be affirmed by operation of Subsection 21.16(i)(2), the taxpayer is deemed to have acquiesced to the determination of the Board of Review and may not further challenge the determination.
 
   (5)   Nothing in Subsection 21.16(i)(2) shall preclude the Office of Finance from auditing any taxpayer, regardless of the results of any Board of Review determination.
 
   (j)   Effect of Delay in Administrative Proceedings. (Added by Ord. No. 174,084*, Eff. 8/19/01.) Failure of the Director of Finance to set any hearing within the time prescribed in this section shall not affect the validity of any proceedings taken hereunder.
 
   (k)   Effect of Payment of an Assessment. (Added by Ord. No. 174,084*, Eff. 8/19/01.) Acceptance of any payment upon an assessment, the validity of which has not previously been passed upon by the Assessment Review Officer, shall not preclude the Director of Finance from subsequently levying another assessment in any case where the original assessment does not truly reflect the correct tax liability.
 
   * The provisions of this Ordinance shall become operative with respect to assessments of tax levied by the Director of Finance under Los Angeles Municipal Code Section 21.16 on and after January 1, 2002.
 
 
SEC. 21.16.1. VOLUNTARY DISCLOSURE.
   (Added by Ord. No. 181,859, Eff. 10/4/11.)
 
   (a)   Notwithstanding any other provisions of the Code, the Director of Finance or the Director’s designee is authorized to enter into a Voluntary Disclosure Agreement (VDA) with any qualifying taxpayer that meets the requirements of this Section. Under a VDA, the period during which a delinquency determination may be made against a qualifying taxpayer with respect to a Business Tax liability under Article 1 of Chapter II of this Code shall be limited to five (5) years after the date on which the tax was due. For the initial twelve (12) month period beginning with the effective date of this Section, the period during which a delinquency assessment may be made against a qualifying taxpayer with respect to a Business Tax liability under Article 1 of Chapter II of this Code shall be limited to three (3) years after the date on which the tax was due. For purposes of this section, a “qualifying taxpayer” is a taxpayer that meets all of the following conditions:
 
   1.   The taxpayer has not previously filed an application for a business tax registration certificate or business tax renewal form with the City;
 
   2.   The taxpayer is engaged in business in the City, as defined in Section 21.00;
 
   3.   The taxpayer voluntarily files an application for a business tax registration certificate and business tax renewal form(s) with the City for all years for which the taxpayer was engaged in business in the City;
 
   4.   The taxpayer has not been previously contacted by the City or by a City contractor regarding its tax liabilities under Article 1 of Chapter II of this Code, and is not currently under audit for or otherwise contesting such liabilities;
 
   5.   The taxpayer fully and completely cooperates with an investigation of the taxes at issue in the VDA, including providing all books and records to the Office of Finance;
 
   6.   As reasonably determined by the Director of Finance or the Director’s designee, the taxpayer’s failure to file a timely application for a business tax registration certificate or business tax renewal form or to pay the taxes owed was due to reasonable cause and was not a result of intentional disregard of the law or because of fraud or an intent to evade the provisions of this Code; and
 
   7.   The VDA contains such terms and conditions as are otherwise necessary to effectuate the VDA program.
 
   (b)   If the Director of Finance or the Director’s designee finds that the taxpayer’s failure to timely file an application for a business tax registration certificate or business tax renewal form or to pay the taxes owed is due to reasonable cause or circumstances beyond the taxpayer’s control, and occurred notwithstanding the exercise of ordinary care and the absence of willful neglect, the taxpayer shall be relieved of the penalties, but not the interest, imposed by Section 21.05 on taxes due. Any taxpayer seeking relief of penalty shall file a statement under penalty of perjury setting forth the facts upon which the taxpayer bases the claim for relief.
 
   (c)   Any VDA entered into by the Director of Finance or the Director’s designee under this ordinance shall be null and void and the Office of Finance may assess all taxes compromised by the VDA if:
 
   1.   A taxpayer misrepresents material facts provided to the Office of Finance with respect to the VDA; or
 
   2.   A taxpayer defaults on an installment payment plan for the taxes at issue under the VDA.
 
 
SEC. 21.17. CONFIDENTIAL CHARACTER OF INFORMATION OBTAINED – DISCLOSURE UNLAWFUL.
   (Amended by Ord. No. 180,380, Eff. 1/5/09.)
 
   (a)   It shall be unlawful for the Director of Finance or any person having an administrative duty under the provisions of this Article or Article 1.6 to make known in any manner whatever the business affairs and operations of, or the nature, amount or source of income, profits, losses, expenditures, net worth, or any particular thereof, or any other information set forth in any statement or return or obtained by an investigation of records and equipment of, any person required to obtain a business tax registration certificate or sales or use tax permit, or pay business, sales or use tax or any other person visited or examined in the discharge of official duty, or to permit any statement or return, or copy of either, or any book containing any abstract or particulars thereof to be seen or examined by any person.
 
   (b)   Nothing in this section shall be construed to prevent:
 
   1.   the disclosure of information to, or the examination of records and equipment by, another City official or employee or a member of the Board of Review for the sole purpose of administering or enforcing any provision of this article or Article 1.6;
 
   2.   the disclosure of information to, or the examination of records by federal or state officials, or the tax officials of another city or county, or city and county, if a reciprocal arrangement exists; or to a grand jury;
 
   3.   the disclosure of information and results of examination of records of a particular taxpayer, or relating to a particular taxpayer, with respect to any proceeding in a court of law or before an administrative body in which the existence or amount of any business, sales or use tax liability of the particular taxpayer to the City of Los Angeles is relevant and material and the particular taxpayer is a party to the proceeding, including but not limited to proceedings before any Board or Commission as set forth in Municipal Code section 22.02;
 
   4.   the disclosure after the filing of a written request to that effect, to the taxpayer, or to the taxpayer’s successors, receivers, trustees, executors, administrators, assignees and guarantors, if directly interested, of information as to the items included in the measure of any paid tax, any unpaid tax or amounts of tax required to be collected, interest and penalties; further provided, however, that the City Attorney approves each such disclosure and that the Director of Finance may refuse to make any disclosure referred to in this paragraph when in the Director’s opinion the public interest would suffer thereby;
 
   5.   the disclosure of the names and addresses of persons to whom registration certificates or sales tax and use tax permits have been issued;
 
   6.   the disclosure of such information as may be necessary to the City Council in order to permit it to be fully advised as to the facts when a taxpayer files a claim for refund of business, sales or use taxes, or submits an offer of compromise with regard to a claim for refund of business, sales or use taxes, or submits an offer of compromise with regard to a claim asserted against the taxpayer by the City for business, sales or use taxes, or where the existence or amount of business, sales, or use taxes are otherwise relevant to the determination of a matter required to be submitted to the City Council under the City of Los Angeles Charter, the Los Angeles Municipal Code, or the Los Angeles Administrative Code;
 
   7.   the disclosure of information to, or the examination of records by, contractors or employees of contractors with whom the City of Los Angeles has contracted to assist the City of Los Angeles for the sole purpose of administering or enforcing any provision of this Article or Article 1.6, if the contract requires the persons granted access to such information or records to abide by the confidentiality requirements of this Section, and if the City Council has approved the award and execution of such contract;
 
   8.   the disclosure of information to, or the examination of records by, purchasers of accounts receivable pursuant to Los Angeles Administrative Code section 5.186, or the disclosure to any employees of such purchasers of accounts receivable, if the purchase agreement requires the persons granted access to such information or records to abide by the confidentiality requirements of this Section;
 
   9.   the disclosure of the identity of any particular taxpayer with delinquent business, sales, or use taxes and the type and amount of the delinquent business, sales, or use tax liability of that taxpayer, and the publication of such information at the discretion of the Office of Finance pursuant to Los Angeles Municipal Code section 21.15(m);
 
   10.   the disclosure of information when compelled by an order of court or other judicial process; and
 
   11.   the disclosure of statistical or cumulative information when the disclosure does not identify any particular taxpayer or reveal information in a manner that could identify a particular taxpayer.
 
 
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