Weekly Round-Up: Tax Debtors in California Beware

A joint collective effort by the Franchise Tax Board and Board of Equalization that posts on the Internet a list of the state’s 250 largest unpaid state tax debtors has generated over $100 million since its inception, a press release by the FTB states.

Under California law, the FTB and BOE are required to post a list of the 250 largest state income tax debtors who owe more than $100,000, the release explains. This list was increased to 500 last fall. The law also allows the agencies to “suspend the professional and/or drivers’ licenses of the state’s top 500 debtors until they resolve their accounts or enter into payment arrangements” and “publish the titles and names of principal officers for business entity delinquencies.”

The current top 250 income and franchise tax debtors on the FTB's list owe a total of $127 million , Laura Mahoney, a staff reporter for BNA reports. The largest single income debt of $14.2 million is owed by Halsey M. Minor, founder of CNet, while actress Pamela Anderson ranks 58th on the list with a debt of $607,860, she notes.

Meanwhile, the SBOE said its top 250 sales tax debtors owed $417.2 million, according to Mahoney. The largest debtor to SBOE is California Target Enterprises, based in Downey, with a balance of $18.3 million, she said.

“California's tax cheats should know we are serious about making them follow the law,” said Board of Equalization Chairman Jerome E. Horton. “Those who owe the BOE and FTB the most will continue to be exposed to public scrutiny to encourage them to pay their delinquencies.”

Laura Mahoney’s article on California’s debtor list can be found in the Daily Tax Report.

In other developments…

Ian Mount, of the New York Times, reports on how the states’ drive to collect taxes on internet sales is a blow to marketers.

Mark Robyn, of the Tax Foundation, releases a new background paper: 2012 State Business Tax Climate Index.

An update by Rusty Little , of the Dow Lohnes Price Tax Consulting Group LLC, on his prior article addressing the sales taxation of the popular “Deal of the Day” or “Groupon” online coupon business model.

Nicholas Johnson and Michael Mazerov, at the Center on Budget and Policy Priorities, argue that the proposed Kansas tax break for “pass-through” profits is poorly targeted and will not create jobs.

Kate Thurber, of PwC, reports on the new proposed combined reporting regulationscoming out of the District of Columbia.

Compiled by Priya D. Nair
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