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(Amended by Ord. No. 149,522, Eff. 5/23/77.)
(a) The provisions of this article shall not be construed to require the payment of any business tax to operate or carry on the functions of any charitable or religious institution, organization or association organized for charitable or religious purposes and conducted solely for such purposes, nor the payment of any business tax to engage in teaching, preaching or otherwise disseminating any religious tenets or the beliefs of any religion; nor shall any business tax be required to be paid by any religious or other charitable association, including fraternal, educational, civic, military, state, county and municipal organizations and associations, for the conducting or staging of any theatrical, art, or sporting exhibition or similar event, or any dance, concert, or lecture, when the net proceeds derived from any of the same are not used for the purpose of private gain to any individual but are used wholly for the benefit of such organization or for charitable or benevolent purposes, nor shall a business tax be required to be paid by any credit union corporation. Such persons are entitled to receive tax exempt registration certificates upon application for and qualification as provided in this section.
(b) An independent contractor who for profit or gain undertakes to carry on any business or activity, for the conduct or operation of which a registration certificate and business tax is required by any section of this article, shall not be exempted from the registration and tax requirements of this Article because of the fact that the independent contractor has paid or agreed to pay or turn over to any charitable institution or organization a portion of the receipts of the business or activity as a reward or recompense for the sponsorship of the business or activity, or for any other reason, and such a contractor shall not be deemed to be acting for purposes entitling the contractor to a tax exempt registration certificate.
(c) 1. The Director of Finance shall, upon application, issue a tax exempt registration certificate to any credit union corporation upon being furnished with satisfactory evidence of its incorporation and operation as such.
2. Any applicant for a tax exempt registration certificate authorized in Subsection (a), other than a credit union corporation, shall make an application upon a form furnished by the Director of Finance. The application shall be forwarded to the Board of Police Commissioners which shall make or cause to be made such investigation of the applicant and the activity carried on or proposed to be carried on as may be necessary to determine whether or not the applicant and the activity for which a tax exempt registration certificate is applied for meet the requirements of Subsection (a) hereof, and that the proceeds of the activity, if any, are to be used for the purposes mentioned therein. The Board of Police Commissioners shall endorse its finding upon the application and return the same to the Director of Finance. If the finding is to the effect that the requirements of Subsection (a) are met, the Director of Finance shall then issue a tax exempt registration certificate provided the applicant has complied with all other applicable provisions of this Code; provided further, however, that when the activity to be engaged in is of the kind for which the applicant must file a Notice of Intention as provided in Article 4 of Chapter 4 of this Code, no tax exempt registration certificate shall be issued until such Notice of Intention has been filed and an Information Card issued to the applicant as provided in said Article 4
. The registration certificate so issued shall show on its face that it is tax exempt. If the finding of the Board of Police Commissioners is that the requirements of Subsection (a) hereof are not met, no registration certificate shall be issued without payment of the tax prescribed in the appropriate section of this article. (Amended by Ord. No. 173,283, Eff. 6/26/00, Oper. 7/1/00.)
(d) If at any time any activity listed in Subsection (a) as being entitled to the issuance of a tax exempt registration certificate is conducted in such a manner that, had it been disclosed in the application described in Subsection (c), would not have entitled the person carrying on the activity to a tax exempt registration certificate, or if the net proceeds derived from those activities named in Subsection (a) are not used for a purpose approved therein, any tax exempt registration certificate therefore issued shall be void and the full amount of the tax shall be due and payable.
(e) Subject to the provisions of Subsection (d) hereof, upon the Director of Finance’s issuance of a tax exempt registration certificate to a person, any tax, including any penalty or interest accrued thereon, owing by such person pursuant to any provision of this article for any period prior to such issuance by virtue of carrying on any activity described in Subsection (a) hereof in the manner prescribed therein which would have entitled such person to receive a tax exempt registration certificate shall be canceled as if it had never become due or owing, and, if paid, a refund thereof shall be made, subject to the provisions of Section 21.07 of this Code, as if it had been overpaid. (Added by Ord. No. 149,522, Eff. 5/23/77.)
Except where a repealing or amendatory ordinance specifically provides otherwise, the amendment or repeal of any portion of Article 1 or Article 1.5 shall not be construed to operate as a release or waiver of any liability or sum of money which may be due or owing to the City of Los Angeles from any person under the provisions of said articles as they existed prior to such amendment or repeal. The rule of construction required by this section is declared to be in clarification and confirmation of the existing intent of said articles, and is not to be construed as applying solely to the effect of repealing or amendatory ordinances adopted subsequent to the effective date of this section.
(Added by Ord. No. 169,977, Eff. 9/3/94.)
(a) Any taxpayer whose business at any location was interrupted for a period of not less than sixty (60) consecutive days as a result of the earthquake of January 17, 1994, upon written application and proof of such interruption to the reasonable satisfaction of the Director of Finance, shall be deemed to have terminated said business at said location on December 31, 1993.
(b) Upon resumption of any business described in Subsection (a) of this section, if the business tax is an annual tax measured by 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, said business shall be deemed to be a newly established business subject to taxation in accordance with the provisions of Section 21.13(a)1 of this article, except that the measure of any additional tax for 1994 shall not commence prior to the date of resumption of said business.
(c) Upon resumption of any business described in Subsection (a) of this section, if the business tax is a flat rate for a year or a fractional part thereof, said tax shall be computed by multiplying the flat rate by a fraction, the numerator of which is the number of days from the resumption of the business through December 31 and the denominator of which is 365.
(Amended by Ord. No. 172,358, Eff. 1/31/99.)
(a) Minimum Business Tax. After payment of a minimum business tax of $25.00, the amount of business tax relief to a person engaged in business at a location in the business tax economic incentive area described in Subsection (j) but not excluded from such tax relief by Subsection (h) shall be an exemption from the next $500.00 in business tax liability.
(b) Time Period of Business Tax Relief. The business tax relief described in Subsection (a) of this section shall be for the tax period beginning on or after January 1, 1995 and ending on or before the termination of the City’s Empowerment Zone as established by the City Council by ordinance. The time period for business tax relief for census tracts that are added to the City’s business tax economic incentive area will commence on the effective date of the Ordinance adding the census tracts and cover the entire calendar year.
A person will only be entitled to the additional business tax relief provided for in Subsections (c), (d), (e), and (f) for up to a maximum period of five years.
(c) Additional Business Tax Relief for Existing Businesses Within the Business Tax Economic Incentive Area. Notwithstanding any other provision of this Code, for the tax years beginning on January 1, 1999 the annual business taxes paid starting in 1999 by any person for a business located within the business tax economic incentive area described in Subsection (j) on or after January 1, 1998, shall not exceed the business taxes paid by such person for the year ended December 31, 1998. Such additional relief shall be for a period of up to five years, as set forth in Subsection (b) above.
(d) Business Tax Relief for Existing Businesses Within the City Relocating into the Business Tax Economic Incentive Area. Notwithstanding any other provision of this Code, the annual business taxes paid during any taxable year by any person for a business (1) located within the City of Los Angeles but outside the business tax economic incentive area on or before December 31, 1998 and (2) which relocates its business activity within the business tax economic incentive area on or after January 1, 1999, shall not exceed the annual business taxes paid by such person during the tax year during which the business relocated into the business tax economic incentive area, subject to the relief provided in Subsection (a) above. Such additional relief shall be for a period of up to five years as set forth in Subsection (b) above.
(e) Business Tax Relief for Existing Businesses Outside the City Relocating Into the Business Tax Economic Incentive Area. Any person whose business was located outside the City of Los Angeles as of December 31, 1997 and which locates its business activity within the business tax economic incentive area on or after January 1, 1998, shall pay no business taxes other than the $25 minimum tax specified in Subsection (a) above for up to a five-year period as set forth in Subsection (b) above.
(f) Business Tax Relief for Newly Established Businesses Within the Business Tax Economic Incentive Area. Any person who starts a “newly established business” as defined in Section 21.00(c) of this Code within the business tax economic incentive area on or after January 1, 1998 shall pay no business taxes other than the $25 minimum business tax specified in Subsection (a) above for up to a five-year period as set forth in Subsection (b) above.
(g) Change of Ownership of Existing Businesses. New proprietors of pre-existing businesses located within the business tax economic incentive area shall not be eligible to receive the incentives set forth in Subsection (e) and (f) above.
(h) Excluded Businesses. The business tax relief described in Subsections (a) through (f) of this section is available to all business tax classifications located within the business tax economic incentive area except that no business tax exemption, waiver, decrease or freeze shall be available to any person whose primary activity at a location is the sale of alcoholic beverages for off-premises consumption or the sale of guns and ammunition, or which is an “adult entertainment business” as defined in the Los Angeles Municipal Code Section 12.70 B.
(i) Conditions to Receive Tax Exemption. The Director of Finance shall determine that one of the following conditions applies to each person seeking business tax relief under Subsections (e) and (f) above unless application of said conditions is waived by the Mayor’s Office.
(1) The business pays all of its work force at a rate at least equal to the living wage as identified in the City’s Living Wage Ordinance in Los Angeles Administrative Code Section 10.37.
(2) The business provides goods or services that are urgently needed in the business tax economic incentive area.
(3) The business can show proof of a significant investment in its workforce (For example: job training, childcare, retirement or investment programs; health or life insurance programs).
(4) A newly established business in the business tax economic incentive area hires at least 50% of its workforce locally from the business tax economic incentive area, or the buffer zone.
The Mayor’s Office shall provide annual reports to the Community and Economic Development Committee of the Council of waivers granted and the justification for those waivers.
(j) Description of Business Tax Economic Incentive Area. The business tax economic incentive area shall lie within the boundaries of the federal Empowerment Zone except that the business license tax economic incentive area shall extend beyond the boundaries of the Empowerment Zone to include both sides of a street in which there is business activity where only one side of that street is included in the Empowerment Zone.
(1) The business tax economic incentive area consists of the area included within the following United States Census Tract numbers, as extended by this subsection where applicable:
1041.020, 1047.010, 2045.000, 2051.000, 2060.000, 2062.000, 2063.000, 2073.000, 2260.000, 2270.000, 2281.000, 2282.000, 2286.000, 2287.000, 2288.000, 2289.000, 2291.000, 2371.000, 2372.000, 2383,000, 2392.000. 2393.000, 2397.000, 2400.000, 2402.000, 2405.000, 2408.000, 2409.000, 2420.000, 2421.000, 2422.000, 2423.000, 2426.000, 2427.000, 2430.000, 2431.000
(2) The map set forth below illustrates the location of the United States Census Tracts listed in Paragraph (1) of this subsection that comprise the business tax economic incentive area. The boundaries of said business tax economic incentive area are extended as set forth in this subsection where applicable.
LOCATION OF UNITED STATES CENSUS TRACTS THAT COMPRISE BUSINESS TAX ECONOMIC INCENTIVE AREA
(NOT ALL TRACTS PICTURED ARE LOCATED IN BUSINESS TAX ECONOMIC INCENTIVE AREA - SEE LAMC SEC. 21.26(j)(1))
Editor’s Note: The map referred to in this section is on file in the official City documents located in the Office of the City Clerk in Council File No. CF-97-0401-S1.
(3) The business tax economic incentive area is described in the table set forth below. The boundaries of said area are extended as set forth in this subsection where applicable.
BUSINESS TAX ECONOMIC INCENTIVE AREA FOR THE CITY OF LOS ANGELES
The table describes both part A and part B in a continuous loop. The loop starts southward by describing part A’s western half and going down to the Slauson and South Central Avenue intersection where part B begins. At the intersection the loop travels in a westwardly direction around part B. Eventually the loop travels back North to describe part A’s eastern half.
SECTION ONE
FIRST HALF OF PART A
INTERSECTION OF N. BROADWAY AND THE LOS ANGELES RIVER
BEGINNING POINT | DIRECTION | ENDING LIMIT |
N. Broadway | Southwest to | College Street |
College Street | East to | N. Alameda |
N. Alameda | South to | Temple Street |
Temple Street | West to | San Pedro |
San Pedro | South to | E. 1st |
E. 1st | West to | Los Angeles Street |
Los Angeles Street | South to | 2nd Street |
2nd Street | West to | S. Hill |
S. Hill | South to | 9th Street |
9th Street | East to | Maple Ave. |
Maple Ave. | South to | E. 21st Street |
E. 21st Street | East to | Central Ave. |
Central Ave. | South to | 42nd Street |
42nd Street | West to | Avalon |
Avalon | South to | E. 48th Street |
E. 48th Street | East to | McKinley Ave. |
McKinley Ave. | North to & back up | E. 48th Street |
E. 48th Street | East to | Central Ave. |
Central Ave. | South to | Slauson Ave. |
BEGINNING OF PART B OF SECTION ONE
INTERSECTION OF CENTRAL AVE. & SLAUSON AVE.
BEGINNING POINT | DIRECTION | ENDING LIMIT |
Slauson Ave. | West to | Van Ness Ave. |
Van Ness Ave. | South to | 62nd Street |
62nd Street | East to | S. Broadway Ave. |
S. Broadway | South to | Florence Ave. |
Florence Ave. | East to | S. Central Ave. |
S. Central Ave. | North to X-section | Slauson Ave. |
SECOND HALF OF PART A SECTION ONE
INTERSECTION OF S. CENTRAL & SLAUSON
BEGINNING POINT | DIRECTION | ENDING LIMIT |
Slauson Ave. | East to | S. Alameda |
S. Alameda | North to | E. 25th Street |
E. 25th Street | East to & following | Southern City Limits With Vernon |
Southern City Limits with Vernon | Follow to | Spence Street |
Spence Street | North to | E. 8th Street |
E. 8th Street | Northwest to | Soto Street |
Soto Street | North to | Santa Monica FWY. |
Santa Monica FWY. | West to | S. Boyle Ave. |
S. Boyle Ave. | North to | Golden State FWY. |
Golden State FWY. | North to | E. 4th Street |
E. 4th Street | West to | N. State Street |
N. State Street | North to | E. 1st Street |
E. 1st Street | West to | Los Angeles River |
Los Angeles River | North to | N. Broadway |
END OF SECTION ONE (PARTS A&B)
SECTION TWO
INTERSECTION OF S. CENTRAL AVE. & E. MANCHESTER
BEGINNING POINT | DIRECTION | ENDING LIMIT |
E. Manchester | West to | San Pedro Street |
San Pedro Street | North to | E. 79th Street |
E. 79th Street | West to | S. Vermont Ave. |
S. Vermont Ave. | South to | Manchester Ave. |
Manchester Ave. | East to | Figueroa |
Figueroa | South to | 104th Street |
104th Street | East to | Wall Street |
Wall Street | North to | 93rd Street |
93rd Street | East to | E. City Limits with Walnut Park |
E. City Limits with Walnut Park | North to | Intersection of Manchester & S. Central Avenues |
END OF SECTION TWO
SECTION THREE
INTERSECTION OF 104TH & SAN PEDRO STREET
BEGINNING POINT | DIRECTION | ENDING LIMIT |
San Pedro St. | South to | Imperial Hwy |
Imperial Hwy | East to | Wadsworth & E. 114th |
114th St. | East to | S. Central Ave |
S. Central Ave | South to | Imperial Hwy |
Imperial Hwy. | East to | E. City/County Limits at Mona Blvd. |
E. City/County Limits at Mona Blvd. | North to | 92nd Street |
92nd Street | West to | Maine St. |
Maine St. | North | E. 91st Street |
E. 91st Street | West to | Compton |
Compton | South to | E. 92nd Street |
E. 92nd Street | West to | Success Street |
Success Street | South to | E. 103rd Street |
E. 103rd Street | West to | S. Central Ave |
S. Central Ave | South to | E. 104th Street |
E. 104th Street | West to X-section | San Pedro |
END OF SECTION THREE
SECTION FOUR
INTERSECTION OF THE VAN NUYS BLVD. & THE FOOTHILL FWY.
BEGINNING POINT | DIRECTION | ENDING LIMIT |
Van Nuys Blvd. | Southwest to | San Fernando Rd. |
San Fernando Rd. | Southeast to | Pierce Street |
Pierce Street | Northeast to | Glenoaks Blvd. |
Glenoaks Blvd. | Southeast to | Osborne Street |
Osborne Street | North to | West side of the Hansen Dam |
West side of the Hansen Dam | Follow East to the | Rancho Tujunga Rancho Ex Mission DE San Fernando line |
Rancho Tujunga Rancho Ex Mission DE San Fernando line | North to | Foothill FWY. |
Foothill FWY. | West to X-section | Van Nuys Blvd. |
END OF SECTION FOUR
(k) Administration. The business tax economic incentive program shall be administered by the Director of Finance who shall notify all known persons engaged in business at a location in the business tax economic incentive area of the program.
(l) Business Tax Forms. It shall be the responsibility of each person engaged in business to compare its activity to the tax relief provided by this section and complete its business tax forms accordingly.
(m) Annual Report to the Mayor and Council by Director of the Office of Administrative and Research Services. The Director of the Office of Administrative and Research Services shall report annually on the measurable costs and benefits of the Business Tax Economic Incentive program. (Amended by Ord. No. 173,304, Eff. 6/30/00, Oper. 7/1/00.)
(Added by Ord. No. 170,798, Eff. 1/21/96, Oper. 1/1/96.)
(a) For every person engaged in an entertainment or multimedia business, which business is located in either the Hollywood Redevelopment Area or the North Hollywood Redevelopment Area, the total tax due under Sections 21.79, 21.109, 21.166, 21.167, 21.189.2, 21.189.4, 21.190 and 21.192 of this article at each such business shall not exceed $25,000.00 plus 10 percent of the amount of tax in excess of $25,000.00 that would otherwise be due. (Amended by Ord. No. 171,521, Eff. 3/27/97, Oper. 1/1/97.)
(b) The “Hollywood Redevelopment Area” is the area established by Ordinance No. 161,202 of the City of Los Angeles, adopted on May 7, 1986. The “North Hollywood Redevelopment Area” is the area established by Ordinance No. 152,030 of the City of Los Angeles, adopted on February 21, 1979.
(c) For the purposes of this section, the following definitions shall apply:
1. An “Entertainment Business” shall mean a business which has as its primary purpose the development, production, post-production, distribution, licensing, or marketing of motion pictures, television programming, video or audio recordings, video graphic images, and/or animation.
2. (Amended by Ord. No. 171,521, Eff. 3/27/97, Oper. 1/1/97.) A “Multimedia Business” shall mean a business that primarily:
i. Produces films, disks, tapes, software or other recording devices, whether visual or audio, through the integration of two or more media, which media include, without limitation, computer generated graphics and video, film, slides, video tapes, audio tapes and photographs;
ii. Provides computer programming services on a contract or fee basis to the producer of films, disks, tapes, software or other recording devices, whether visual or audio, through the integration of two or more media, which media include, without limitation, computer generated graphics and video, film, slides, video tapes, audio tapes and photographs, such services to include computer software design and analysis, modification of custom software, digital imaging and other related programming services; and
iii. Develops online and internet services, including the design of WEB sites, for clients.
(d) The terms “entertainment business” and “multimedia business,” as used in this section, shall not include any “adult entertainment business,” as defined in Section 12.70 B. of this Code.
(e) The provisions of this section shall apply only to businesses that generate more than 50% of their gross receipts from entertainment and/or multimedia business activities.
(f) The provisions of this section shall not become operative prior to January 1, 1997, except that they shall become operative upon the commencement of operations for businesses which commence operations in the Hollywood Redevelopment Area or the North Hollywood Redevelopment Area on or after January 1, 1996.
(g) If either the Hollywood Redevelopment Area or the North Hollywood Redevelopment Area, or both, shall become dissolved, the provisions of this section shall not apply thereafter to businesses located within what had been the boundaries of the dissolved area.
(Amended by Ord. No. 176,342, Eff. 1/19/05, Oper. 7/1/05.)
(a) Small Business. No tax is required to be paid under this Article by any Small Business. A Small Business shall mean any person whose total taxable and nontaxable gross receipts from within and without the City do not exceed $50,000.00. The $50,000.00 amount shall be increased to $100,000.00 on July 1, 2006.
(b) Creative Artist. No tax is required to be paid by a person under this Article for gross receipts attributable to “Creative Activities”, earned when that person is engaged in business as a “Creative Artist”, unless the total taxable and nontaxable gross receipts from within and without the City which are attributable to “Creative Activities” exceed $300,000.00 annually.
For purposes of this exemption, a “Creative Artist” shall mean only a person who operates either (1) as an individual, (2) through a corporation with one individual as the only shareholder and the only employee (commonly referred to as a “loan-out”), or (3) through a limited liability company with one individual as the only member and the only employee. “Creative Activities” shall mean activities described herein. Gross receipts from Creative Activities shall not include any gross receipts received by a Creative Artist from activities that are not Creative Activities (for example, public appearances or product endorsements, or teaching as opposed to performing). Such other receipts shall not be exempt under this subsection, and shall be taxable as otherwise provided in this Article. In implementing the intent of this subsection, the Director of Finance shall consider that Creative Activities are distinct from a craft, and that this exemption applies to Creative Artists for their Creative Activities but not to craft persons. References to “multi-media” are to be interpreted as defined in subsection (b) of Section 21.189.4.
Eligibility for the small business exemption provided in subsection (a), above, shall be based on total taxable and non-taxable gross receipts from within and without the City, including receipts for Creative Activities.
Creative Activities shall mean activities performed by Creative Artists primarily for entertainment and/or aesthetic purposes, including assistants or professional trainees performing those same Creative Activities, in the following professions:
1. The following professions to the extent they are directly involved with motion picture, radio or television productions, commercials, multi-media or recorded or live music or theater:
- Actor or announcer; or
- Art director, costume designer, production designer, scenery or set designer; or
- Choreographer; or
- Cinematographer; or
- Conductor of bands, chorales, orchestras, and other musical groups; or
- Director; or
- Motion picture editor, sound dubbing, special effects, or titling artist; or
- Writer (where the writing is the writer’s own creative work, but not writing that is compilation, documentation or description of a non-artistic nature, such as technical writing, the writing of technical or scientific reports, etc.); or
- Music or lyrics arranger, composer or writer; or
2. Author of books, essays, poems or short stories; or
3. Cartoon artist, including animated media; or
4. Creator of visual fine arts, using artist’s materials (i.e., lithographer, painter, sculptor, or the equivalent); or
5. Drawing, graphic, illustration or sketch artist; or
6. Performing artist, including comedian, dancer, impersonator, juggler, magician, mime, musician, or singer; or
7. Photographer, to the extent the photography is primarily artistic in nature and not primarily journalistic or commercial.
(c) Any person exempt from tax under Subsections (a) or (b) shall be required to timely file for registration and subsequent renewals before the delinquency date. The failure to timely file or renew prior to the date the taxes would otherwise have been delinquent pursuant to Section 21.05 of this Article, shall render inapplicable the exemption provided in Subsections (a) and/or (b) and subject the person to the tax that would otherwise be payable and to any interest and penalty applicable thereto.
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