TITLE
Recommendation to authorize City Manager to execute an agreement with the California Franchise Tax Board (FTB) for records obtained
from the FTB Taxpayer Information System and Business Entity Tax System, at a cost of $0, with a term of June 1, 2012 through
December 31, 2014. (Citywide)
DISCUSSION
In 2001, the State of California passed Assembly Bill 63 (AB 63), the Local Government Sharing Program, which permits the State to share certain income tax information with local governments. Under the program, participating cities are provided a list of businesses within the City that filed California income tax returns. The City can then ensure these businesses have applied for and received City business licenses.
The agreement will authorize the City to participate in the Local Government Sharing Program for the 2011, 2012, and 2013 tax years. The information that will be provided by the FTB is the taxpayer name, address, social security number or taxpayer identification number, and principal business activity code. This information will allow the Department of Financial Management to identify businesses in the City that are operating without a business license.
The City has been participating in the Local Government Sharing Program since the 2002 tax year, and is currently using 2009-2010 FTB data. The identification of unlicensed businesses has resulted in revenue to the General Fund. The City is devoting additional staff time to the program for FY 12 to ensure the receipt of business license revenue from identified businesses.
Along with other participating cities, this agreement allows FTB and the City to enter into a reciprocal agreement to exchange tax data specific to City business license information for tax administration purposes.
The proposed agreement contains the following major provisions:
ยง Length of term: June 1, 2012 through December 31, 2014. This agreement is for tax years 2011, 2012 and 2013 only. In order to participat...
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