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Business groups send dueling messages on L.A. tax hike

February 1, 2013 |  5:13 pm

The push to increase L.A.'s sales tax in the March 5 election produced some back-and-forth between the city's business groups Friday, with two organizations pushing for the measure and a third strongly dissenting.

The campaign for Proposition A announced Friday that the Los Angeles Area Chamber of Commerce and the Los Angeles Business Council have both backed the March 5 ballot measure, which would add a half cent to each dollar of taxable sales and boost the city's rate to 9.5%, among the highest in the state. Backers made the announcement in an email with the heading: “Los Angeles business community unites in support of Proposition A.”

“As business leaders, we see a direct and substantial link between the City’s ability to provide first rate public safety and a robust business climate,” said chamber President Gary Toebben.

Two hours later, the Valley Industry and Commerce Assn. fired off its own announcement restating its opposition to the tax, under the title: “Los Angeles’ business community split over half-cent sales tax increase.”

“There is no question that the City of Los Angeles’ budget needs help,” said Stuart Waldman, president of VICA, which represents businesses in the San Fernando Valley. “Imposing one of the highest sales tax rates in the county in a struggling economy is not the answer. It is bad for the city, bad for the economy and bad for business.”

The tax, which needs a majority to win passage, is designed to help the city erase a $220-million budget shortfall.

The head of a fourth business group, the downtown-based Central City Assn., has taken no position on the sales tax hike. Carol Schatz, the organization’s top executive, said her group concluded that the measure “reflects the city’s inability to make the hard decisions.” However, it decided not to wage a campaign against it out of a fear that "individual industries will be targeted for new taxes if it fails."

“That doesn’t look like a united business community to me,” Schatz said.


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-- David Zahniser at Los Angeles City Hall