Council Delays Decision on Tax Plan for HMOs
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After an hour of contentious debate Wednesday, the Los Angeles City Council put off a decision for at least two weeks on whether to reduce the tax burden of five major health maintenance organizations by millions of dollars.
Although Councilwoman Laura Chick urged quick action to revise the HMOs’ tax structure, she bowed to a request to delay the matter after some of her colleagues objected to what seemed like a hefty tax break for one particular industry.
Under the plan, the firms would collectively pay $7 million a year in city taxes, compared with $25 million under the current system.
“To me, that’s an $18-million tax break,” said Councilman Mike Hernandez, who first opposed the proposal, then asked Chick to postpone it.
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