Businesses Make Use of Amnesty Program

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Businesses in Los Angeles paid $18.6 million in taxes they owed to the city under an amnesty program that allowed them to avoid penalties, city officials announced Tuesday.

The three-month amnesty program, which concluded on July 31, nearly doubled the city’s expectations and exceeded the $17 million total generated by a similar amnesty program in 2001. The money has gone into the city’s general fund and is helping to plug a budget shortfall of more than $300 million.

“By paying their fair share of city taxes, the businesses that participated are actively supporting the essential services that make our city work,” Mayor Antonio Villaraigosa at a City Hall press conference announcing the amnesty program results. “The program allowed us to increase revenue without raising taxes.”

In all, 8,673 businesses participated in the amnesty, resulting in the city waiving $6.7 million in penalties. Of those businesses, 394 are newly registered and are expected to provide ongoing additional revenue to the city.

Of the $18.6 million the city received, $16.1 million came from the gross receipts tax; the rest came from utility taxes, the hotel bed tax and taxes on parking lot operators.

With the amnesty program over, the city’s Office of Finance has resumed its enforcement policy. The office will conduct audits, on-site investigations and match data with other government agencies in order to collect taxes and penalties.

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