Councilman Jeff Lalloway proposes repeal of Irvine business license tax

Mayor Pro Tem Jeff Lalloway wants to repeal the Irvine business license tax, a $50 annual fee paid by all Irvine businesses.

The Irvine City Council is slated to take up Lalloway’s tax cut plan at this Tuesday’s city council meeting. If approved, Lalloway’s tax repeal could save Irvine businesses nearly $1 million per year.

“It is a regressive tax that charges huge Fortune 500 companies the same amount as a mom and pop business,” Lalloway said. “If this proposal is approved, we will be one of the first cities to eliminate a tax — which is something virtually unprecedented in America today — and thereby returning almost $1 million back to our residents.”

Plan Could Save Irvine Businesses $1 Million Per Year

$50 Annual Tax: Same for All Irvine Businesses

Under the city’s business license program, Irvine businesses are charged a $50 annual fee for the pleasure of doing business in the city. In the 2013-14 Fiscal Year, Irvine collected $971,859 in business license taxes and penalties.

Lalloway believes the business tax and registration program is an inefficient use of city resources.

At its May 26 meeting, the Irvine City Council advanced Lalloways tax cut plan on a 3-2 vote, with Councilwoman Christina Shea and Councilwoman Lynn Schott supporting Lalloway.

In addition to Irvine business license tax, Irvine also requires all businesses operating within the city limits to register and obtain a business license. This requirement, according to city staff, “also extends to business owners who provide services in the City, but are located or headquartered in another jurisdiction.” Non-profit groups, religious organizations and banks are also required to obtain a business license, but are currently exempt from the tax.

To read the Irvine City Council staff recommendation on the tax cut proposal, click here.