Los Angeles County Bar Association's 2013 Tax Practitioners' Conference

During a recent session of the Los Angeles County Bar Association's Tax Practitioner's Conference, Chairman Jerome Horton was asked to address four important questions.

  1. What are the four biggest challenges facing California from a taxation perspective?
    "The creation of more jobs which lead to more tax revenue, enabling the state to provide social services and repairs to its infrastructure. We must always be mindful of conforming to federal tax law. We urgently need to reform the regulatory processes so businesses feel more comfortable. Finally, reducing the overall complexity of the state tax code. Additionally, strengthening taxpayer confidence in the system, as well as addressing the issue of replacing seasoned auditors and senior staff, 44% of whom will retire in the next four years."
  2. What are the most significant future initiatives and programs that the BOE is considering or may consider next year?
    "The creation of an appeals process for the Franchise Tax Board similar to the one the Board of Equalization has. I will continue to encourage the passage of AB 575 & AB 576, both of which address the problems of the underground economy. We must continue exploring other legislation that lessens the tax burden on all Californians. Finally I would like to see the expansion of the BOE's Volunteer Income Tax Assistance and Earned Income Tax Credit Initiative. These programs protect taxpayers from paying more than they have to."
  3. What are the 4 key "best practices" for effectively presenting a tax case before the BOE?
    "This is a great question. First and foremost, practitioners shouldn't walk into a BOE appeals hearing thinking they know more than board members do. Make sure your written testimony is not ambiguous, incomplete or contradictory—also don't talk about evidence the board members haven't seen. It will just delay a resolution. Don't stray from applicable law or regulation. Finally, a board appeals hearing is not a court room and rules of evidence do not apply. Yet act like they do. One more thing; if you see the ship sinking, salvage what you can."
  4. How do you assess the condition of California's business climate?
    "I'm informed that we still face a slow recovery and that is underscored by the unemployment rate that I watch carefully. Total employment growth for this year and the next two years is expected to be an average of just over 2%. The implication is that we are looking at another three years of slow, steady but unexceptional economic growth with a slight acceleration. UCLA economist, William Yu is worried. Yu believes L.A. will continue to fall behind other cities in terms of income and employment growth for several decades. He points to the low level of human capital as the main reason—in other words, we're not providing enough educated and skilled workers."

Jerome E. Horton, Chairman, California Board of Equalization