Briefs

FEb 3, 2003. Los Angeles officials scoured 324,000 electronic files in the process of hunting down Don Mann, an admitted business-tax violator.

But in Mann's case, their prize looks pretty paltry. If Mann's accountant is correct, all that searching will lead the Van Nuys resident to cough up about $100 in delinquent business license taxes.

Cities, counties and states across the country increasingly are turning to a practice known as data mining to squeeze more money out of taxpayers, often through the collection of little-known levies such as business taxes and so-called use taxes.

In 2001, a state law was passed allowing the California Franchise Tax Board to share information gleaned from Californians' income-tax returns with cities and counties. That gave city finance departments a way to check on taxpayer compliance, and Los Angeles asked for files on anyone living in the city who reported income from self-employment or owning a business.

The city received 324,695 files. About half of those taxpayers were dismissed as duplicates and bigger businesses that already paid tax under a corporate name. The rest were sole proprietors, self-employed individuals or people who worked at home or had some outside free-lance income. Late last year, Los Angeles sent notices demanding three years' worth of tax payments on their gross revenues, threatening penalties of up to 40 percent if the taxes weren't paid.

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