News Details
Schipske Proposes to Give Business Tax Relief to Independent Contractors
Dear Readers,


Long Beach, CA - June 1, 2012 - I am continuing my advocacy on behalf of Long Beach small businesses by introducing a council item that would provide business license tax relief for independent contractors during the coming Fiscal Year.


In my agenda item for the June 12 council meeting, I point out that the current economic market remains depressed , particularly in real estate - which is partially due to the mortgage crisis and the number of homes now "underwater" - making it extremely difficult for the independent contractor to survive. 


I also note that the City of Long Beach requires independent contractors, such as real estate agents, to obtain a business license. Real estate brokers under which these agents work must also pay for a separate business license. Both real estate agents and brokers also generate the "real estate property transfer tax" which results in additional revenue to the City. There are a number of other types of independent contractors that are also struggling to stay in business as they deal with this difficult economy.


In 1991, the City Council enacted a 16% surcharge on business licenses for capital projects. This surcharge apparently has been folded into the amount of the business licenses (although it still appears on licenses as a separate charge), and increases the amount of the business license tax to its current levels.


The City of Long Beach has a legitimate interest in promoting business in the city. Frequently, the city provides rebates of sales taxes or other financial incentives to keep businesses located here. A waiver of either the business license tax and/or a backing out of the 16% surcharge on independent contractors for at least the next fiscal year would provide some relief to these businesses and signal the city's support.


My agenda item, if passed, would request the City Manager to report to the City Council within 90 days on the feasibility of waiving the business license tax and/or the 16% surcharge being removed from business licenses for independent contractors for at least FY 2013.


Since taking office, I have pursued a number of efforts to assist small businesses, including a small business advisory committee; "prime time business" - which encourages City Council to showcase a local business once a month at council meetings; and a package of "business growth incentives" which she placed on the Council agenda last August. She is planning on urging her colleagues to hold a town hall: "A Day Without a Regulation" - to listen to the concerns from businesses on what can be done in the city to stimulate the local economy.


Small business is the economic engine of our community and local government needs to do what it can to support and encourage it and to get out of the way when it needs to.



Thank you for taking time to be involved. If you need additional information or comment, please email me at:

Councilwoman Gerrie Schipske