How many superheros is too many?

The City of Los Angeles is attempting to set limits on street performers, like these pictured above, in a one block area on Hollywood Boulevard.  The block in question, between Highland and Orange Avenues is one of the most heavily trafficked in the area.  The City Council has instructed the City Attorney's office to draw up regulations and has recommended that the number of permits granted each day be limited to 20.

Matt Balke is an actor/screenwriter who is one of the street performers who works on the block that is the subject of the proposed limits.  Mr. Balke points out in an excellent op-ed piece for the Los Angeles Times, that such limits are probably unconstitutional.

As Mr. Balke also points out, those who go to this block to intimidate passersby into giving them tips, and who violate the existing ordinance prohibiting "aggressive panhandling" won't pay attention to the permitting requirement, even if an unlimited number of permits are made available.  The actions of those people who cause problems are why we all too often see this in that area.

So rather than limiting the number of performers who are issued permits, perhaps the City of Los Angeles could follow the example of Santa Monica and issue an unlimited number of permits; but limit the amount of time any one performer can work in a specific location.

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There is an upside to the City of Los Angeles  requiring street performers to obtain permits.  The City of Los Angeles has a gross receipts tax.  I doubt that any of these street performers are taking in more than $100,000 annually in tips, and would therefore be exempt from that tax.  However, the requirement to comply with the City's annual licensing requirement would be much easier to enforce for those street performers who have to get that permit.

That might well make it more difficult for those performers to forget to claim their income from this work on their annual income tax returns.  I'm sure that a law-abiding citizen like Mr. Balke is reporting his tip income on his tax return, but are all of them doing this?  Cash businesses are the worst offenders when it comes to the so-called "tax gap."  This refers to the amount of income taxes that the federal government doesn't receive because of the amount of income that goes unreported.  A 2008 study estimates that the tax gap that year was between $450 billion and $500 billion.  While forcing street performers to pay taxes on their cash income won't make a big dent in this amount, every dollar helps.