Business Licenses and Permits

During these tough economic times, most communities have sought to raise business license fees in order to make up for lost revenue. But one California town is taking the opposite approach and hopes its plan generates increased economic growth.

City officials in Murrieta have agreed to waive the business license fee for any business planning to open in the historic downtown area during the next year. The plan is designed to relax the financial burden on new businesses plus give incentive to help reshape the historical area of the city.

Currently most businesses pay a business license fee of $75 each year in Murrieta. Larger companies however can pay up to $300 a year for a business license. The fee waiver will only apply to new businesses that open before September 2011 in the historic downtown area. This area is between Ivy and Kalmia Streets to the north and south, and between Hayes Street and Jefferson Avenue to the east and west.

To cope with the loss of licensing revenue, Murrieta will ask the Riverside County Redevelopment Agency for funding since the historic area falls within a county redevelopment zone. The Murrieta Chamber of Commerce applauds the proposal because $75 can be a pretty substantial financial burden on new small business owners.

Hopefully Murrieta’s business tax relief program is successful for the community. If it is maybe more cities will realize that tax cuts typically generate more revenue in the long run, while tax increases have the opposite affect.

Ryan Julson, Business License Research Anlayst, Corporation Service Company

Tags: business license, Corporation Service Company, historic downtown, Murrieta