Business Files Its Objections to State's Hunt for Back Taxes -LAT

[Rose Siding]

SACRAMENTO — Business groups are pushing to scale back a new state law that imposes stiff penalties on taxpayers who do not pay all they owe.

The law parallels an aggressive move by tax officials to collect back taxes from tens of thousands of delinquent California residents and businesses. Under its terms, tougher penalties than any the state has ever imposed will apply to tax dodgers who do not come clean during a two-month amnesty that ends March 31.

Supporters of the program say scaling it back would cost the state too much. The face-off highlights a deep split in Sacramento over how aggressively the state should go after suspected tax cheats.

Corporations and anti-tax groups are promoting emergency legislation to narrow the scope of the law and soften — if not eliminate — some of the fines. The administration of Gov. Arnold Schwarzenegger is in discussions with the business groups about backing the legislation or asking tax officials to make some businesses exempt from penalties.

http://www.latimes.com/news/local/la-me-amnesty6feb06,0,42544.story?coll=la-home-headlines

[Judi Lynn]

1. This is very interesting. I'd like to know how it ends.....

From the article:

Some Democrats, including the new law's author, say easing the penalties could cost the state as much as half of the $280 million that tax officials estimate the amnesty could generate. It's money Democrats say is badly needed as California continues to struggle with a multibillion-dollar budget shortfall.

Democrats hope to capture more of the estimated $6.5 billion in revenue projected to be lost each year from tax evasion. They see it as a way to shield healthcare, social services and schools from cuts without new taxes.
(snip)

"These guys pay their accountants big bucks to manipulate the system and save them money," said Lenny Goldberg of the California Tax Reform Assn. "They're concerned they're going to be hit with big penalties if they keep playing their games."

Tax officials estimate the program would raise $280 million in new revenue by enticing people and businesses to come clean if they failed to file returns, underreported their income or exaggerated deductions. They project that the amnesty will hasten collection of another $300 million in taxes that would normally be paid in future years.

It's a different group of Californians from those the state went after last year, with an amnesty for wealthy individuals and corporations who used complex tax shelters. That effort astounded tax officials by generating $1.4 billion for the state. They had estimated it would bring in $90 million.
(snip)

[DBoon]

2. They get an amnesty and they still complain?

I mean paying these taxes is THE LAW, right? And even though they have been breaking THE LAW, they still get a chance to pay up with no penalty. What are they complaining about?

The state faces bankruptcy and these people think they can break the law and get away without paying their share of taxes?

[struggle4progress]

3. kick