Third Street Promenade (File photo)

By Jeong Park
Daily Press Intern

State inspectors will be visiting Santa Monica businesses starting in July to check if they are complying with the state regulations.

Eight representatives from the California Board of Equalization’s Statewide Compliance and Outreach Program will inspect retail businesses in the 90403, 90404 and 90405 ZIP codes. Home-based businesses will not be inspected.

About 98 percent of California businesses have valid permits, but the state has said noncompliance had contributed to more than $2 billion in uncollected taxes. The program seeks to educate businesses about their tax obligations and identify those operating without valid permits.

When state officials visited businesses in the 90401 and 90402 ZIP codes last year, they found that three businesses were operating without permits. Businesses in the 90401, 90402 and 90403 ZIP codes were inspected in 2009 and 2010.

Yating Campbell, a spokesperson for the California Board of Equalization, said the program’s staff seeks to visit all of the state’s non-home based retail businesses every few years, although businesses located in ZIP codes with higher business density are visited more often because businesses in those areas change frequently.

Campbell said the visit often doesn’t take long. The program’s staff will identify themselves and ask the owner of the business a few questions about whether they have appropriate permits, she said. Businesses will also have a chance to ask the staff about the regulations.

“Our intent is not to disrupt the business. Our goal is to finish as quickly as possible,” Campbell said.

If owners are not at their businesses during the visits, the staff will leave their cards and will try to come back later, Campbell said. She said businesses registered with the Board of Equalization would receive letters notifying them of the visit. Additionally, she said the state hopes to reach out to the businesses not registered with the board through its website and other media.

Businesses most commonly commit violations such as not applying the correct amount of sales tax to transactions and not having the proper permits, Campbell said.

The program’s staff will assist businesses in getting valid permits if the businesses do not have them. Businesses can apply for many permits online or through the Board of Equalization’s field office, Campbell said. The staff will also assist businesses in filing taxes correctly, as business owners may not be aware of certain sales tax deductions and exemptions, Campbell said.

Campbell said the program has generated $467.5 million in revenue since it started in 2008.