Wilson Vetoes Bill on Income Tax Info

A measure that would have given state income tax information to cities to help them track down business-tax scofflaws has been vetoed by Gov. Pete Wilson in the face of opposition by the Writers Guild of America.

The guild organized entertainment industry groups, including songwriters and broadcast artists, to push for the veto as part of its opposition to a Los Angeles ordinance requiring home-based businesses to obtain a city business permit.

The writer’s group earlier this year filed a lawsuit against the city to exempt writers and artists from registering as home-based businesses.

AB 701 would have made it easier for the city to find unregistered home-based businesses and other businesses by comparing state tax lists against the city’s list of business owners.

In vetoing the measure, the governor said the state should not furnish the tax data while the legal challenge is pending.

“We are very pleased that the governor found the issues raised in the lawsuit compelling enough that AB 701 should not go forward until the lawsuit is resolved,” said Mark Ryavec, a guild lobbyist.

City officials will try to rewrite the bill in light of the governor’s concern, said Michael Karsch, a city legislative analyst.

The city clerk’s office and the city controller had sought the measure for the last two years, after discovering that the state listed 60,000 people who earned a living as Los Angeles business owners but were not registered as city businesses and paid no city taxes, Karsch said.

The measure was revised after some legislators raised privacy concerns, and it appeared to have the governor’s support, he said.

“We did everything everybody wanted, but something went wrong in the past month,” he added.

Meanwhile, a federal court hearing on the guild lawsuit is scheduled next month.

In addition, city officials plan to modify the home-occupation permit ordinance to conform with a recent city attorney’s opinion that home-based businesses that do not impact their neighborhoods are not required to obtain permits.