Bill Text: CA AB1774 | 2011-2012 | Regular Session | Introduced
Bill Title: Sales and use tax: exemption: gold and silver coins:
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2012-04-09 - In committee: Set, first hearing. Hearing canceled at the request of author. [AB1774 Detail]
Download: California-2011-AB1774-Introduced.html
BILL NUMBER: AB 1774 INTRODUCED
BILL TEXT
INTRODUCED BY Assembly Member Mansoor
FEBRUARY 17, 2012
An act to add Title 3 (commencing with Section 3460) to Part 2 of
Division 4 of the Civil Code, and to amend Sections 6354 and 6355 of,
and to add Sections 18154.2 and 24996 to, the Revenue and Taxation
Code, relating to taxation.
LEGISLATIVE COUNSEL'S DIGEST
AB 1774, as introduced, Mansoor. Sales and use tax: exemption:
gold and silver coins: income and corporation taxes: capital gains.
(1) Federal law provides that United States coins and currency are
legal tender for all debts, public charges, taxes, and dues.
Existing law further provides that a person may pay a debt in gold
coin or legal-tender notes of the United States unless otherwise
provided in the obligation out of which the debt arises.
This bill would provide that gold and silver coin issued by the
federal government is legal tender in California and that a person
may not compel another person to tender or accept gold and silver
coin that is issued by the federal government, except when otherwise
provided in the obligation out of which the debt arises.
(2) The Sales and Use Tax Law imposes a tax on retailers measured
by the gross receipts from the sale of tangible personal property in
this state, or on the storage, use, or other consumption in this
state of tangible personal property purchased from a retailer for
storage, use, or other consumption in this state. That law provides
various exemptions from those taxes, including an exemption for the
sale in bulk of bullion and numismatic coins, and the storage, use,
or other consumption of, those bullion and coins, as provided.
This bill would additionally exempt from those taxes, the gross
receipts from the sale of, and the storage, use, or other consumption
in this state of, gold and silver coins issued by the federal
government.
The Bradley-Burns Uniform Local Sales and Use Tax authorizes
counties and cities to impose local sales and use taxes in conformity
with the Sales and Use Tax Law, and existing law authorizes
districts to impose transactions and use taxes in accordance with the
Transactions and Use Tax Law which conforms to the Sales and Use Tax
Law. Exemptions from state sales and use taxes are incorporated into
these laws. Section 2230 of the Revenue and Taxation Code provides
that the state will reimburse counties and cities for revenue losses
caused by the enactment of sales and use tax exemptions.
This bill would provide that, notwithstanding Section 2230 of the
Revenue and Taxation Code, no appropriation is made and the state
shall not reimburse local agencies for sales and use tax revenues
lost by them pursuant to this bill.
(3) The Personal Income Tax Law and the Corporation Tax Law
provide that a gain or loss upon the disposition of a capital asset
is determined by reference to the specified adjusted basis of that
asset.
This bill would provide, under both laws, that the gross income of
a taxpayer does not include any gain from the sale or exchange of
gold and silver coins issued by the federal government.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Title 3 (commencing with Section 3460) is added to Part
2 of Division 4 of the Civil Code, to read:
TITLE 3. Legal Tender
3460. (a) Gold and silver coin issued by the federal government
is legal tender in the state.
(b) A person may not compel any other person to tender or accept
gold and silver coin that is issued by the federal government, except
when otherwise provided in the obligation out of which the debt
arises.
SEC. 2. Section 6354 of the Revenue and Taxation Code is amended
to read:
6354. (a) There are exempted from the taxes
imposed by this part, the gross receipts from the sales of
commemorative "California Gold" medallions produced and sold in
accordance with Chapter 25 (commencing with Section 7551) of Division
7 of Title 1 of the Government Code, and the storage, use, or other
consumption in this state of commemorative "California Gold"
medallions so produced and sold.
(b) There are exempted from the taxes imposed by this part, the
gross receipts from the sales of gold and silver coins issued by the
federal government, and the storage, use, or other consumption in
this state of gold and silver coins issued by the federal government.
SEC. 3. Section 6355 of the Revenue and Taxation Code is amended
to read:
6355. (a) There are exempted from the taxes imposed by this part
the gross receipts from the sale in bulk of monetized bullion,
nonmonetized gold or silver bullion, and numismatic coins that are
substantially equivalent to transactions in securities or commodities
through a national securities or commodities exchange and the
storage, use, or other consumption in this state of monetized
bullion, nonmonetized gold or silver bullion, and numismatic coins so
sold.
(b) (1) A sale in bulk, for purposes of this section, shall be
deemed to have occurred if the amount of monetized bullion,
nonmonetized gold or silver bullion, and numismatic coins sold in the
transaction totals, in market value, the sum of one thousand dollars
($1,000) or more, or its equivalent.
(2) The board shall adjust the one thousand dollar ($1,000) amount
specified in paragraph (1) as follows:
(A) On or before September 1, 1994, and on or before each
September 1 of each year thereafter, the board shall multiply the
amount applicable for the current calendar year by the inflation
factor adjustment determined by the Franchise Tax Board pursuant to
subdivision (h) of Section 17041, the resulting amount to be the
applicable amount for the succeeding calendar year. The applicable
amount shall be operative as an adjustment of the amount specified in
paragraph (1) only when the applicable amount computed is equal to
or exceeds a new operative threshold, as defined in subparagraph (C).
(B) When the applicable amount equals or exceeds an operative
threshold specified in subparagraph (C), the resulting applicable
amount, rounded to the nearest multiple of five hundred dollars
($500), shall be operative for purposes of paragraph (1) beginning
January 1 of the succeeding calendar year.
(C) For purposes of this paragraph, "operative threshold" means an
amount that exceeds by at least five hundred dollars ($500), the
greater of either the amount specified in paragraph (1) or the amount
computed pursuant to subparagraphs (A) and (B) as the operative
adjustment to the amount specified in paragraph (1).
(c) (1) "Monetized bullion," for
purposes of this section, means coins or other forms of money
manufactured of gold, silver, or other metal and heretofore, now, or
hereafter used as a medium of exchange under the laws of this state,
the United States, or any foreign nation. "Monetized bullion," for
purposes of this section, also means gold medallions struck under
authority of the American Arts Gold Medallion Act (Title IV of Public
Law 95-630).
(2) "Monetized bullion," "nonmonetized gold or silver bullion,"
and "numismatic coins," for purposes of this section, shall not
include gold and silver coins issued by the federal government.
(d) A sale of monetized bullion, nonmonetized gold or silver
bullion, or numismatic coins, for purposes of this section, shall be
deemed to be substantially equivalent to a transaction in securities
or commodities through a national securities or commodities exchange,
if the sale is by or through a person registered pursuant to the
Commodity Exchange Act (7 U.S.C. Sec. 1 et seq.) or not required to
be registered under the Commodity Exchange Act.
SEC. 4. Section 18154.2 is added to the Revenue and Taxation Code,
to read:
18154.2. (a) For each taxable year beginning on or after January
1, 2012, gross income shall not include any gain from the sale or
exchange of any qualified capital assets.
(b) For purposes of this section, "qualified capital assets" means
gold and silver coins issued by the federal government.
SEC. 5. Section 24996 is added to the Revenue and Taxation Code,
to read:
24996. (a) For each taxable year beginning on or after January 1,
2012, gross income shall not include any gain from the sale or
exchange of any qualified capital assets.
(b) For purposes of this section, "qualified capital assets" means
gold and silver coins issued by the federal government.
SEC. 6. The provisions of this act are severable. If any
provision of this act or its application is held invalid, that
invalidity shall not affect other provisions or applications that can
be given effect without the invalid provision or application.
SEC. 7. Notwithstanding Section 2230 of the Revenue and Taxation
Code, no appropriation is made by this act and the state shall not
reimburse any local agency for any sales and use revenues lost by it
under this act.
