Mayor Antonio Villaraigosa and other officials headed to Downtown L.A.'s "Auto Row" Monday morning to sign off on a new ordinance.
At a new KIA dealership just off Figueroa Boulevard near USC, the mayor made final a new exemption from the city's gross receipts tax for new auto dealerships opening in Los Angeles,
The Mayor and others hope it will bring such retailers--and sales tax revenues and jobs--back to the city.
Many had fled to smaller communities like Glendale and Beverly Hills to avoid the tax.
According to the mayor's office, Los Angeles has lost 95 deaderships in the last 25 years.
The KIA dealership is the second to open in Downtown L.A. in the last 18 months.
The mayor's office says KIA will add about $400,000 in sales tax per year to the City’s general fund--as much as six times what would be lost in gross receipts taxation.
KIA currently employs 50 people and is expected to hire another 15 for its expanding business.
Villaraigosa worked with council members Eric Garcetti and Mitch Englander to move the ordinance through the approval process.
The ordinance will be retroactive to the start of this year and will expire at the end of the 2020 tax year.
By that time, the gross receipts tax for all companies in the city may be eliminated, if the City Council approves a plan this fall for a phased scrapping of the tax.