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Artists safe at home from L.A.’s work tax

City Council bows to pressure from entertainment community

Writers, actors, musicians and graphic artists are home free — at least in Los Angeles.

Bowing to pressure from the entertainment community, the Los Angeles City Council voted unanimously Wednesday to repeal key provisions of the home business occupancy tax, which would have forced thousands of performers, artists and others to pay biz fees and taxes for working at home.

L.A. officials appear to have responded to charges that the permit and fee provisions were unduly intrusive and even unconstitutional. However, several other cities — including Beverly Hills, Burbank, Malibu and San Francisco — are considering similar ordinances.

The 1997 passage of L.A.’s Home Occupation Ordinance extended biz-license and tax requirements to writers and others working in their homes. The ordinance required anyone conducting business at home to get a $25 permit and pay either a minimum tax or a gross receipts tax. City officials still have the power to enter any place of business to determine whether it should be registered and taxed.

The ordinance, which went into effect on Sept. 5, 1997, potentially affected more than 160,000 people and was expected to generate between $4 million to $5 million a year for the city’s coffers.

Almost immediately, the ordinance caused an outcry and prompted a lawsuit from the Writers Guild of America West. The suit’s supporters included AFTRA, American Society of Journalists & Authors, Graphic Artists Guild, Motion Picture Editors Guild, National Academy of Songwriters, National Writers Union, Professional Musicians Local 47, Motion Picture Screen Cartoonists Guild and the Society of Composers & Lyricists.

Free speech

“The repeal of this permit is a victory for the First Amendment rights of anyone who writes in the privacy of their home,” WGA West president Daniel Petrie Jr. said after the 13-0 vote. “The guild applauds the council for recognizing that the permit was an unnecessary and potentially chilling regulation of free speech.”

Repeal of the permit and its $25 fee renders moot one-third of the WGAW’s lawsuit against the city. The guild still objects to what it calls the “threat of invasive enforcement procedures” and the requirement that writers and others obtain a license to work.

The measure also prompted a proposal for a state law to protect writers and others from onerous city taxes. Assembly Bill 2065 would prohibit any California city from requiring writers, musicians, directors and other creative artists to register for home occupation or work permits, business licenses, or to pay business taxes.

But the outlook is daunting. The city of San Francisco wants to register all creative artists; in Malibu, city staffers are discussing with members of the Business Roundtable a proposal that would require business licenses of anyone working at home.

In addition, Burbank is considering a home-occupation ordinance that would forbid a home-based worker from having a part-time employee.

BevHills cops

The city of Beverly Hills’ proposed home occupation ordinance would give landlords the right to deny anyone the right to work in their home; as a result, a writer, painter or composer residing in a rental apartment or house could be prohibited from working in Beverly Hills.

Repeal of the L.A. measure was greeted with favor at the Screen Actors Guild, which opposed it not so much on First Amendment grounds but because it could have roped under its provisions an actor doing something as innocuous as receiving scripts or meeting at home with agents or publicists.

“We’re delighted that the city has taken this position,” said Catherine York, SAG’s director of government relations. “We thought (the ordinance) was an unfair standard for performers and other creative artists.”

City Council member Laura Chick, chief proponent of the repeal, and fellow council members Ruth Galanter and Mike Feuer could not be reached for comment after the vote.

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