RIORDAN, FEUER, ALATORRE RELEASE JOINT TAX REFORM
PROPOSAL WITH LARGE START-UP INCENTIVE AND BROAD CUTS
Mayor Richard Riordan and Council members Mike Feuer and Richard
Alatorre
released a joint business tax reform proposal today that would
attract
start-up companies to the City, cut taxes for nearly two-thirds
of
existing businesses in Los Angeles, lower all tax categories,
treat
similar businesses alike, dramatically simplify the tax code,
and cost the
General Fund $16.2 million * $4.2 million less than an earlier
proposal.
The joint proposal, to be considered Thursday by the Ad Hoc
Committee on
Tax Reform, guards the General Fund by encouraging tax compliance
and
improving enforcement. It is the result of an intense effort to
unite the
tax reform plan originally proposed by Mayor Riordan and Council
member
Alatorre with an alternative plan put forth by Council member
Feuer.
*This joint proposal reflects the best of both earlier plans,
and it will
go a long way toward improving the business climate in Los Angeles,*
said
Feuer, who serves both on the Ad Hoc Committee on Tax Reform and
on the
Budget and Finance Committee. *We have the most dynamic economy
in the
world, but to keep it growing we need to cut taxes, attract entrepreneurs,
and simplify our tax code. I believe this plan accomplishes all
of that,
and at a substantially lower cost to the General Fund than the
original
proposal.*
The joint plan includes a first year start-up exemption for
businesses
earning up to $500,000 in gross receipts to attract new businesses
to the
City, a reduction in all tax categories, similar treatment for
similar
businesses, a 6% overall reduction affecting two-thirds of businesses
in
Los Angeles, and a single Standard Industry Code system so that
companies
no longer have to file in multiple categories.
The proposal also would commit the City to consider additional
tax relief
for various key industries, including biomedical/biotechnical,
wholesale
trade (durable goods), manufacturing, computer and multimedia,
job
training, and creative industries.
A joint letter to the Council from Mayor Riordan and Council
members
Feuer and Alatorre outlining the new tax reform proposal is attached.
-30-