California – State Board of Equalization to Verify Business Permits and Tax Compliance

SALT Report 1224 – The California State Board of Equalization recently sent more than 12,000 letters to businesses in 21 different zip codes statewide notifying them of upcoming visits by BOE specialists as part of the Statewide Compliance and Outreach Program (SCOP).

SCOP is designed to increase tax compliance by ensuring that all businesses in California are properly registered and reporting their taxes and fees.  SCOP’s focus is on educating business owners as well as identifying and registering businesses that are actively selling or leasing tangible personal property in California without a seller’s permit.

The purpose of SCOP is to:

  • Educate business owners regarding their tax responsibilities
  • Advise business owners when they need a seller’s permit
  • Explain to business owners how to report and remit their taxes and fees
  • Verify and update BOE account information, and
  • Review business operations and compare them to previously filed sales and use tax returns to ensure proper reporting
The BOE’s intent is to visit every business in the state over time, particularly if a business sells taxable retail items. There are seven SCOP teams with approximately eight people each, located throughout the state.  The teams conduct door-to door visits of storefronts and other businesses based on zip code. Registered retailers and service industry businesses will be checked to see if they hold the appropriate permits and licenses. If a business is found to be out of compliance they will be given instructions on how to register with the BOE and how to apply for all necessary licenses.
The SCOP program has found that approximately 2% of businesses operating in California do so without permits or licenses. This non-compliance is responsible for a $2 billion sales and use tax gap.
For Further Information: