Newport Beach waives license taxes for local business hit by the pandemic

About 1,850 commercial businesses in Newport Beach affected by the ongoing pandemic closures will be able to waive the costs of their business license taxes for one year.

The Newport Beach City Council voted unanimously during its regular meeting this week to approve a one-year waiver that will apply to renewals for the business license tax of identified businesses between April and March of next year.

City officials said there are about 25,000 businesses throughout the city that have permits, including those with home businesses and those doing business in Newport Beach that are headquartered elsewhere.

The business license tax is an annual tax that is determined by where the business operates within the city and is adjusted every July to reflect inflation.

Restaurants, bars, department stores, furniture stores, jewelry stores, clothing stores, shoe stores, bookstores, bakeries, dance studios, child care services, tour operators, hair and nail care and gyms will automatically receive a waiver.

The average tax paid is about $294 for the group of about 1,850 businesses identified by city staff as eligible, according to city finance director and treasurer Scott Catlett during a presentation Tuesday.

An appeal process will be put in place for businesses that may have been misclassified.

The waiver is expected to cost the city about $667,000 and will be offset by budget surplus funds the city has on hand.

“We’ve obviously seen substantial business interruption over the last year due to both the pandemic and then, in particular, our state’s response to the pandemic,” said Councilman Will O’Neill, thanking Councilwoman Diane Dixon and Mayor Pro Tem Kevin Muldoon for their efforts on the business ad hoc committee.

“This is a good example of a way that the city could continue to help in both small and big ways,” said O’Neill.

Muldoon said it was “pretty inconceivable” that cities would close businesses and continue to charge them for operation when they couldn’t open their doors, adding that Newport Beach approached the issue educationally in an effort to keep businesses open.

“This city’s always been committed to small businesses and we see small business as so important to the fabric of our town,” said Mayor Brad Avery. “It’s really real out there and I think all of us can identify with. We’re customers, but we also got a lot of friends who run businesses and we appreciate them. This is just another effort by the city of Newport Beach to support our small businesses.”

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