The taxman cometh to more than 19,000 California retailers

SACRAMENTO
September 25, 2012 9:02pm

California retailers in 22 ZIP codes around the state are getting letters from the Board of Equalization notifying them of upcoming visits from the “Statewide Compliance and Outreach Program” teams, who will “educated” them about properly reporting sales and use tax to increase compliance with tax laws, says George Runner, Second District member of the California State Board of Equalization.

The visits are intended to assure that the state’s tax system is fair and equal for all Californians.

BOE has sent 19,071 letters to business owners in the following zip codes: Menlo Park (94025); San Francisco (94110); Pollock Pines (95726); Camino (95709); Placerville (95667); El Dorado (95623); El Dorado Hills (95762); Shingle Springs (95682); Sunnyvale (94086); Santa Maria (93454); Scotts Valley (95066); La Cañada Flintridge (91011); Newport Beach (92663); Santa Ana (92704); Quail Valley (92587); San Diego (92108); Cabazon (92230); Whitewater (92282); National City (91950); Riverside (92504); Hemet (92545), and Julian (92036).

Seven SCOP teams located statewide (Oakland, Sacramento, San Jose, Van Nuys, Norwalk, Irvine and Riverside) conduct door-to-door, in-person visits based on ZIP code. They check sellers’ permits at stores and other known retail locations.

They ask only business-related questions, and do not inquire about personal financial information, the BOE says. SCOP teams check that registered retailers, as well as service industry businesses, have appropriate permits and licenses.

Team members are supposed to educate businesses found to be out of compliance by providing instructions on how to register with the BOE, and information about other necessary licenses. SCOP team members do not visit businesses operated out of peoples’ homes.

Since 2008, the BOE SCOP teams have visited more than 330,000 businesses statewide to verify that retailers are registered, and to make sure that noncompliant businesses do not have an unfair advantage over registered businesses that are reporting their sales and use taxes and/or fees to BOE.

BOE has found that about 98 percent of businesses operating in California have the necessary permits or licenses that allow for collection of sales and use taxes, as well as other taxes and fees.

However, the 2 percent who do not comply contribute to the more than $2 billion sales and use “tax gap” – the difference between the amount of taxes owed and the amount paid.