Thousands of California business owners can expect some money returned to them from the state. The Board of Equalization announced it's scaling back an automatic security deposit program.
For decades the security deposit program required a security deposit be automatically collected before a business owner can get a seller's permit in California.
The deposit ranged from $2,000 up to a maximum of $50,000.
The money was part of a security deposit until the new business paid sales tax dollars to the state.
The BOE decided to remove this state requirement, saying it was more trouble than it was worth.
That's because state officials say 90 percent of California entrepreneurs pay their sales tax dollars. Only a small fraction do not.
More than 15,000 business owners who paid the deposit will be getting that money back.
George Runner, a Board of Equalization member, believes this is a good thing for the businesses themselves.
"What it means is this, is it's money out of their pocket that they can't put it into their business. So it's a great, refreshing decision and certainly a great time of the year to be able to give a gift back to California business. It's tough to do business in California, this is just one step to make it a little easier," Runner said.
The BOE says business owners will likely see those security deposits returned in February.
State officials still may require an entrepreneur with a bad record of paying sales taxes to pay a deposit before getting a business permit.
Any business owner with questions can call the board of equalization at 916-445-2181.