City of Los Angeles v. Wilshire Crest Medical Group

Appellant taxpayer complains of the manner in which the City of Los Angeles seeks to apply its tax on business activities. Such complaint verges on an invitation to an éxcursion in frivolity.

We are importuned to ignore the definition of the term “gross income” contained in the statute establishing the tax in question and to substitute therefor the definition of the term “receipts” contained in a legal dictionary which, in turn, used as its source a Tennessee case construing a statute of that state. We decline, for the reasons hereafter stated, to indulge in such an obliquity.

Appellant is a medical corporation which employed individuals to practice medicine within the City of Los Angeles during 1972, 1973, and 1974. In the court below respondent sought to recover an assess ment for unpaid business taxes during the years in question. The evidence was reduced to an agreed statement of facts.

The issue in controversy was the propriety of appellant’s use of the cash method of accounting to report its gross receipts used to measure the business tax for 1972-1974. The court below agreed with respondent’s contention that the accrual method of accounting should have been…