The amount of Los Angeles work created by local companies could soon increase thanks to some new city incentives.
City officials are looking into implementing a "Business Tax Holiday" for new businesses in Los Angeles. Proposed by the Mayor's Office of Economic and Business Policy, the BTH would exempt any new business from gross receipts tax for three years.
An independent analysis from USC Marshall found that the BTH would create revenue for the city and serve as an incentive for businesses to locate in Los Angeles.
"The new policy will lead to the creation of up to 55,000 jobs and generate additional revenue for the City of Los Angeles," USC Professor Charles Swenson, PhD, said. "In addition, the multiplier effect of additional economic activity in the city nets a positive revenue impact."
Another part of the plan would call for new local businesses and their employees to purchase goods and services from other local businesses, which will then pay business tax receipts to the city on their incremental revenues.
"The city wants to capture companies that are considering another U.S. municipality or the local business that may decide to locate just outside of the Los Angeles border to take advantage of seemingly more favorable tax rates," Councilman Greig Smith, vice chair of the Budget and Finance Committee, said. "It is critical that we decrease the cost of doing business in Los Angeles."
In addition to these efforts, the Los Angeles Department of Water & Power is considering a program that would support and attract new business by creating a team to respond to new customer inquiries and provide discounts of up to 25 percent.
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