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(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.
(Amended by Ord. No. 175,029*, Eff. 2/5/03, Oper. 2/1/03.)
(a) (Amended by Ord. No. 182,275, Eff. 11/20/12.) A business that establishes a new fixed location within the City and is not owned, in whole or in part, by a person that was engaged in business in an existing fixed location in the City in the immediately preceding tax year, is a “New Business” that shall be exempt from the applicable minimum tax for its first tax year of operation. This business shall also be exempt from any other tax imposed under this Article for up to its first two tax years of operation, or its first three tax years of operation if the business first commenced operations between January 1, 2010, and December 31, 2015, as follows:
1. For its first two tax years of operation, a New Business that has less than $500,000.00 of total taxable yearly gross receipts shall be exempt from any additional tax imposed pursuant to this article for any tax year in which it has less than $500,000 in total taxable gross receipts. However, if a New Business first commences operations between January 1, 2010, and December 31, 2015, a New Business shall be exempt from any minimum or additional tax imposed pursuant to this Article for its first three tax years of operation, regardless of how much tax would be imposed absent this exemption. A business qualifying for exemption under this subdivision for its first tax year of operation shall also be exempt from the applicable minimum tax for its second tax year of operation, or its second and third tax years of operation if it first commences operations between January 1, 2010, and December 31, 2015.
(i) The exemption for tax in the second tax year of business operation is extended to December 31, 2017. The exemptions for tax for the second and third tax years of business operations are subject to review and may result in a suspension under any of the following circumstances as determined by the Council, subject to the approval of the Mayor:
(A) The City experiences a major natural or human-made disaster including, but not limited to, earthquakes, fires, or terrorist incident, for which the response and recovery require expenditure of more than one percent of General Fund revenues (i.e., $40,000,000 in 2006-07); or
(B) An economic downturn resulting in a greater than one percent overall actual decline in all General Fund revenue for the fiscal year ended June 30th of that year (i.e., $40,000,000 in 2006-07); or
(C) The City is legislatively, legally or otherwise precluded from levying and collecting General Fund revenue that results in a greater than one percent total decline in budgeted General Fund revenue for the fiscal year (i.e., $40,000,000 in 2006-07); or
(D) The City receives a legal judgment for which either an option for legal appeal does not exist, or the City Council and Mayor decline to pursue that legal appeal, and the judgment exceeds ten percent of the Reserve Fund (i.e., $18,500,000 in 2006-07); or
(E) There is a non-discretionary occurrence requiring expenditure of funds from the Emergency Reserve Account of the Reserve Fund.
(ii) To implement a suspension of the exemption in a given calendar year, action by the Council, subject to the approval of the Mayor, must be made by September 30th of the preceding calendar year.
(iii) The exemption period shall be in effect for ten years unless the Council takes one of the following actions: (a) before September 30th of the fifth year the Council takes an affirmative action not to extend the exemption period for a second consecutive five year period; or (b) prior to September 30th of the tenth year of the exemption period, the Council extends the exemption period beyond ten years. A suspension of the tax exemption will result in an equivalent period being added to the original ten-year exemption period, or five-year exemption period if the Council takes action not to extend the exemption period for the second five-year period. This would result in the sunset clause of the ordinance expiring at the end of ten years, or the number of years the exemption was in effect plus any suspension period, whichever is greater, but in no event would the actual number of years of second year tax exemption exceed ten, unless the Council takes an affirmative action to extend the exemption period beyond ten years, or if the council takes an action not to extend the exemption period for a second five-year period, the sunset clause of the ordinance would expire at the end of the fifth year, or the number of years the exemption was in effect plus any suspension period, whichever is greater, but in no event would the actual number of years of second year tax exemption exceed five.
(iv) Reinstatement of the tax exemption shall require approval of the Council, subject to the approval of the Mayor.
2. A new business shall not include a construction business involved in the following activities: single-family housing construction (as defined by the 1997 NAICS Industry Code 233210); multi-family housing construction (as defined by the 1997 NAICS Industry Code 233220); manufacturing and industrial building construction (as defined by the 1997 NAICS Industry Code 233310); commercial and institutional building construction (as defined by the 1997 NAICS Industry Code 233320); highway and street construction (as defined by the 1997 NAICS Industry Code 234110); bridge and tunnel construction (as defined by the 1997 NAICS Industry Code 234120); water, sewer and pipeline construction (as defined by the 1997 NAICS Industry Code 234910); power and communication transmission line construction (as defined by the 1997 NAICS Industry Code 234920); plumbing, heating, and air-conditioning contractors (as defined by the 1997 NAICS Industry Code 235110); painting and wall covering contractors (as defined by the 1997 NAICS Industry Code 235210); electrical contractors (as defined by the 1997 NAICS Industry Code 235310); masonry and stone contractors (as defined by the 1997 NAICS Industry Code 235410); drywall, plastering, acoustical, and insulation contractors (as defined by the 1997 NAICS Industry Code 235420); carpentry contractors (as defined by the 1997 NAICS Industry Code 235510); floor laying and other floor contractors (as defined by the 1997 NAICS Industry Code 235520); roofing, siding and sheet metal contractors (as defined by the 1997 NAICS Industry Code 235610); water well drilling contractors (as defined by the 1997 NAICS Industry Code 235810); structural steel erection contractors (as defined by the 1997 NAICS Industry Code 235910); glass and glazing contractors (as defined by the 1997 NAICS Industry Code 235920); excavation contractors (as defined by the 1997 NAICS Industry code 235930); security systems services (except locksmiths) (as defined by the NAICS Industry Code 561621); or a film producer (as defined in Section 21.109 of this Code or the applicable industry code).
(b) Any new business that is exempt from tax under Subsection (a) above shall be required to obtain a Tax Registration Certificate and an exemption letter from the Director of Finance. Failure to obtain these documents prior to the taxes becoming delinquent pursuant to Section 21.05 of this Code, shall render inapplicable the exemption provided in Subsection (a) and subject the business to the tax that would otherwise be payable and to any interest and penalty applicable pursuant to Section 21.05 of this Code.
* Section 3 of Ord. No. 175,029 provides that “[t]his section is repealed effective December 31, 2006.”
(Added by Ord. No. 174,083, Eff. 8/19/01, Oper. 1/1/02.)
(a) There shall be a Settlement Bureau in the City Attorney’s office, which shall be staffed by one or more representatives of the City Attorney. The purpose of the Settlement Bureau shall be to receive and respond to offers of settlement from persons who have been assessed or otherwise billed for delinquent taxes, or who have filed claims for refund of overpaid taxes which have been denied in whole or in part, under this article or Articles 1.1, 1.3, 1.7, 1.11 or 1.15 of this chapter. The tender of an offer of settlement shall not constitute any part of the offeror’s administrative remedy process. The amount of any unaccepted offer or counteroffer of settlement shall not be disclosed by the Settlement Bureau staff to any person outside of the Settlement Bureau, whether within or without the City Attorney’s office, except as may be necessary to obtain approval of a provisionally accepted settlement, as provided in subsection (c) hereof.
(b) Any person may tender to the Settlement Bureau an offer of settlement of a claim by or against the City, described in subsection (a) hereof, prior to the commencement of litigation on the merits of said claim. Each such offer shall be in writing and contain the amount the offeror proposes to pay to or receive from the City and the factual and legal grounds in support of the offer. In response to any offer or counteroffer of settlement, the Settlement Bureau, on behalf of the City, shall accept it, reject it or make a counteroffer. The terms of any settlement between the offeror and the City shall be set forth in a written agreement executed on behalf of both parties. The tender or pendency of an offer of settlement in the Settlement Bureau shall not affect the timing or disposition of any administrative proceeding under Section 21.16 of this article. Upon execution of a written settlement agreement on behalf of both parties, any pending administrative proceeding on a claim which is the subject of the settlement shall terminate. Upon the commencement of litigation by or against the City on the merits of a claim which is the subject of a pending settlement offer or counteroffer, said pending offer or counteroffer shall be deemed rejected.
(c) Any settlement offer or counteroffer accepted by the Settlement Bureau, which requires the approval of a person or entity, other than the City Attorney, pursuant to Charter Section 273 or Los Angeles Administrative Code Sections 5.173 or 5.175, shall be accepted provisionally on behalf of the City, subject to obtaining such other required approval.
(Added by Ord. No. 174,088, Eff. 8/19/01.)
(a) Reward Program. The Director of Finance is authorized to pay such sums as the Director deems necessary for detecting nonpayments and underpayments of City of Los Angeles business tax. Any amount payable under this section shall be paid from the proceeds of the amount collected as a result of the information provided.
(b) Eligibility to File Claim for Reward. Any person, other than certain present or former City of Los Angeles employees, who submits to the Office of Finance information relating to the nonpayment or underpayment of business tax is eligible to file a claim for reward under this section. No person who was employed by the City of Los Angeles in the Office of Finance, at the time the person came into possession of information relating to the nonpayment or underpayment of business tax, or at the time the person submitted such information to the Office of Finance, shall be eligible for reward under this section. Any other City officer or employee, or former City officer or employee, is eligible to file a claim for reward if the information submitted to the Office of Finance came to the officer’s or employee’s knowledge other than in the course of the officer’s or employee’s official duties.
(c) Submission of Information and Filing Claim for Reward. Any person desiring to claim a reward under this section must submit information relating to the nonpayment or underpayment of business tax to the Office of Finance on a form furnished by, and in the manner prescribed by, the Director of Finance. As early as the time of such submission of information, but no later than one year after the City’s recovery of unpaid or underpaid business tax pursuant to the submitted information, the person must file a claim for reward with the City Clerk on a form furnished by, and in the manner prescribed by, the Director of Finance.
(d) Payment of Reward. All relevant factors, including the value of the information furnished in relation to the facts developed by the investigation of the nonpayment or underpayment, shall be taken into account by the Director of Finance in determining whether a reward shall be paid, and if so, the amount thereof. Reasons for rejecting a claim for reward include, but are not limited to:
(1) the information submitted by the informant was of no value;
(2) the information submitted by the informant was already known to the City; and
(3) payment would be contrary to law.
(e) Amount of Reward. The amount of a reward shall represent what the Director of Finance deems to be adequate compensation in the particular case, not to exceed 10 percent of the additional taxes, interest and penalties which are recovered as a result of the information. No reward shall be paid if the Director of Finance determines that the recovery was so small as to call for a reward of less than $50.00. Payment of a reward will be made as promptly as the circumstances of the case permit, but not until the taxes, interest and penalties involved have been collected. However, the informant may waive any claim for reward with respect to an uncollected portion of the taxes, interest and penalties, in which case the claim may be immediately processed. Only a duly authorized representative of the Director of Finance is authorized to make any offer or promise, or statement otherwise purporting to bind the Director of Finance with respect to the payment of any reward or the amount thereof, and any such offer, promise or statement must be in writing.
(f) Protest by Informant Against Action on Claim. If an informant protests the action taken on the claim, the Director of Finance or the Director’s representative may confer with the informant or the Director’s representative to resolve the protest. In the course of such conferring, the Director or the Director’s representative may disclose the amount collected pursuant to the information furnished by the informant, notwithstanding the provisions of Section 21.17
of this article. However, the results of any audit or examination shall not be revealed to the informant or the informant’s representative in violation of Section 21.17 of this article.
(g) Anonymity of Informant. In order to fairly distribute the burden of taxation among the subjects thereof, it is the policy of the City of Los Angeles to encourage informants to submit information concerning unpaid and underpaid business taxes. In furtherance of this policy, no person shall disclose the identity of an informant to any unauthorized person, except to the extent required by law. If other than the informant’s true name is used in furnishing the information, the claimant must include with their claim satisfactory proof of the claimant’s identity as the informant.
(Added by Ord. No. 178,101, Eff. 1/9/07.)
Unless specifically listed under other areas of this article, the annual tax rates are as follows:
(a) Tax Rate A shall be $1.05 for each $1,000 of gross receipts or fractional part. (Amended by Ord. No. 179,171, Eff. 10/8/07.)
(b) Tax Rate B shall be $1.32 for each $1,000 of gross receipts or fractional part. (Amended by Ord. No. 179,171, Eff. 10/8/07.)
(c) Tax Rate C shall be $2.65 for each $1,000 of gross receipts or fractional part. (Amended by Ord. No. 179,171, Eff. 10/8/07.)
(d) Tax Rate D shall be $3.28 for each $1,000 of gross receipts or fractional part. (Amended by Ord. No. 179,171, Eff. 10/8/07.)
(e) Tax Rate E shall be $3.70 for each $1,000 of gross receipts or fractional part. (Amended by Ord. No. 179,171, Eff. 10/8/07.)
(f) Tax Rate F shall be $5.07 for each $1,000 of gross receipts or fractional part. For tax years beginning after December 31, 2015, the rate shall be reduced from this maximum rate as follows: (Amended by Ord. No. 183,419, Eff. 3/20/15.)
1. For the tax year beginning on January 1, 2016, Tax Rate F shall be $4.75 for each $1,000 of gross receipts or fractional part;
2. For the tax year beginning on January 1, 2017, Tax Rate F shall be $4.50 for each $1,000 of gross receipts or fractional part;
3. For tax years beginning after December 31, 2017, Tax Rate F shall be $4.25 for each $1,000 of gross receipts or fractional part.
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