Notwithstanding any other provisions of this Article, a “small business enterprise” as hereinafter defined, shall be exempt from payment of the payroll expense tax; provided, however, that a small business enterprise shall pay the annual registration fee pursuant to Section 855 of Article 12.
The term “small business enterprise” shall mean and include any taxpayer:
Whose tax liability under this Article, but for this exemption provision, would not exceed $2,500 or, effective January 1, 2009 whose taxable payroll expense does not exceed $250,000; and
Who has filed a tax return by the last date of February for the preceding tax year. If the taxpayer fails to file a return by that date, the taxpayer shall be subject to a penalty as specified in subsection (d).
For the 2011 tax year, and each second succeeding tax year the Tax Collector shall increase the ceiling for the small business tax exemption (rounded to the nearest $10,000 increment) to reflect increases in the United States Department of Labor’s Bureau of Labor Statistics consumer price index for all urban customers for the San Francisco-Oakland-San Jose area for each of the preceding two tax years.
In lieu of the penalty specified in Section 6.17-3 of Article 6 for failing to file a return, any person who otherwise qualifies for the small business tax exemption set forth in this Section who fails to file a return by the last date of February shall pay a penalty as follows:
If the person’s payroll expense tax liability under this Article, but for the small business tax exemption under this Section, would be $2,250 or more, the penalty shall be 5 percent of the amount of such liability, for each month, or fraction thereof, that the amount due is delinquent, plus an additional 5 percent each month, or fraction thereof, that the amount due is delinquent, up to a maximum of 20 percent of the tax liability. Any penalties remaining unpaid for a period of 90 days or more shall be subject to an additional penalty of 20 percent of the amount of the tax liability excluding penalties and interest.
Penalties are due and payable when assessed. Unpaid penalties shall accrue interest at the rate of 1 percent per month, or fraction thereof, from the date that they are assessed through the date of payment. The total amount of the penalties, interest and fees shall not exceed the amount of the person’s payroll expense tax liability for the period but for the small business tax exemption.
The Tax Collector may, in his or her discretion, reduce the penalty set forth in subsection (d) to not less than $100 upon a showing that the late filing of the return was due to reasonable cause and not due to willful neglect.
(Amended by Ord. 397-82, App. 8/12/82; Ord. 357-88, App. 8/4/88; Ord. 273-93, App. 8/25/93; Ord. 179-94, App. 5/3/94; Ord. 195-94, App. 5/13/94; Ord. 267-94, App. 7/29/94; Ord. 429-94, App. 12/23/94; Ord. 24-98, App. 1/16/98; Ord. 63-01, File No. 010274, App. 4/25/2001; Ord. 177-01, File No. 010826, App. 8/17/2001; Ord. 26-04, File No. 031990, App. 2/19/2004; Proposition Q, 11/4/2008; Proposition E, App. 11/6/2012, Oper. 1/1/2014; Ord. 206-13, File No. 130784, App. 10/11/2013, Eff. 11/10/2013, Oper. 1/1/2014)