All of these homes were destroyed and need to be rebuilt, including with applicances and furniture. People should not have to pay sales tax to rebuild.
Reza Akef Founder of Metro Capital Builders and inventor and entrepreneur Jeremy Padawer have started a new petition that would exempt Wildfire Victims from paying sales tax as they rebuild. The sales tax in L.A. County and L.A. City is 9.75%.
Akef and Padawer point out that sales tax on rebuilding effectively penalizes victims for the cost of returning to their homes. Families are not “making a purchase” in the traditional sense. They are replacing what was lost due to a declared disaster.
“If you build a $3 million dollar structure, you could save as much as $200,000 not having to pay 10% sales tax. In construction, more than 50% of the cost has sales tax. In the Palisades, at least 5,000 structures of various sizes need to be rebuilt. If on average each one saves $100,000 for not paying sales tax, that is saving the community rebuild at least half a billion dollars!” the two write in the petition.
Not only will people be taxed for rebuilding, they will be taxed when they have to buy appliances, bathroom fixtures and furniture to put in the new homes.
This would have to be an L.A. County Ordinance, with supervisors taking the lead and acknowledging:
- The financial burden of rebuilding is immense, and providing sales tax relief will directly assist property owners, both residential and commercial, in their recovery.
- The recovery of businesses is essential for the economic vitality and employment stability of the affected communities.
- It is in the best interest of the County to support all property owners by minimizing financial obstacles to rebuilding and encouraging them to remain in the affected communities.
- The authority to create a sales tax exemption for local transactions rests with the County.
Akef and Padawer have crafted a simple way for wildfire victims to apply for a sales tax exemption.
To claim the exemption, a resident must first submit a “Calamity Claim” with the L.A. County Assessor’s office to verify the property damage. The Assessor’s office will issue a “Wildfire Recovery Sales Tax Exemption Certificate” that could be presented to retailers at the time of purchase.
To read the entire document and to the petition click here.
Or contact NoFireSalesTax@Gmail.com.
Excellent idea. Those whose homes are standing but have experienced significant smoke damage should also be included. All the soft goods we have to replace… mattresses, furniture, clothing…electrical items, mold-lined refrigerators, new flooring, drywall, paint, carpeting. The costs will be significant just to go home.