Bill Text: CA AB2518 | 2015-2016 | Regular Session | Amended
Bill Title: Sales and use taxes: exemption: nonprofit corporation: building and construction supplies.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Failed) 2016-11-30 - From committee without further action. [AB2518 Detail]
Download: California-2015-AB2518-Amended.html
BILL NUMBER: AB 2518 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY MAY 18, 2016
AMENDED IN ASSEMBLY MAY 16, 2016
AMENDED IN ASSEMBLY APRIL 28, 2016
INTRODUCED BY Assembly Member Gomez
FEBRUARY 19, 2016
An act to add and repeal Section 6356.9 of the Revenue and
Taxation Code, relating to taxation, to take effect immediately, tax
levy.
LEGISLATIVE COUNSEL'S DIGEST
AB 2518, as amended, Gomez. Sales and use taxes: exemption:
nonprofit corporation: building and construction supplies.
Existing sales and use tax laws impose taxes on retailers measured
by the gross receipts from the sale of tangible personal property
sold at retail 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,
and provides various exemptions from the taxes imposed by those
laws.
This bill, until January 1, 2020, would partially exempt from
those taxes the gross receipts from the sale of, and the storage,
use, or other consumption in this state of, building and construction
supplies, materials, equipment, and machinery, and the parts
thereof, that are purchased for a specified use by a nonprofit
corporation, as provided. The bill would make the purchaser liable
for the payment of sales tax if the building and construction
supplies, materials, equipment, and machinery, and the parts thereof,
are removed, converted, or used in a manner not qualifying for the
exemption.
The Bradley-Burns Uniform Local Sales and Use Tax Law 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, as specified, to impose transactions and use taxes in
accordance with the Transactions and Use Tax Law, which conforms
generally to the Sales and Use Tax Law. Exemptions from state sales
and use taxes are incorporated into these laws.
This bill would specify that this exemption does not apply to
local sales and use taxes and transactions and use taxes and
specified state sales and use taxes the proceeds of which are
deposited into the Local Revenue Fund, the Local Revenue Fund 2011,
the Local Public Safety Fund, and the Education Protection Account.
This bill would specify that this exemption does not apply to
specified state sales and use taxes from which the proceeds are
deposited into the Local Revenue Fund, the Local Revenue Fund 2011,
the Local Public Safety Fund, and the Education Protection Account.
The Bradley-Burns Uniform Local Sales and Use Tax Law 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, as specified, to impose transactions and use taxes in
accordance with the Transactions and Use Tax Law, which generally
conforms to the Sales and Use Tax Law. Exemptions to 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 any local agencies for sales and use tax revenues
lost by them pursuant to this bill.
This bill would take effect immediately as a tax levy, but its
operative date would depend on its effective date.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 6356.9 is added to the Revenue and Taxation
Code, to read:
6356.9. (a) There are exempted from the taxes imposed by this
part the gross receipts from the sale of, and the storage, use, or
other consumption in this state of, building and construction
supplies, materials, equipment, and machinery, and the parts thereof,
that are purchased for use by a nonprofit corporation that is exempt
from federal income taxation as an organization described in Section
501(c)(3) of the Internal Revenue Code that has received a welfare
exemption under Section 214.15, for construction and rehabilitation
of properties in this state that are intended to be sold and are sold
to persons and families of low income.
(b) (1) Notwithstanding any provision of the Bradley-Burns Uniform
Local Sales and Use Tax Law (Part 1.5 (commencing with Section
7200)) or the Transactions and Use Tax Law (Part 1.6 (commencing with
Section 7251)), the exemption established by this section does not
apply with respect to any tax levied by a county, city, or district
pursuant to, or in accordance with, either of those laws.
(2)
(b) Notwithstanding subdivision (a), the exemption
established by this section shall not apply with respect to any tax
levied pursuant to Section 6051.2 or 6201.2, Section 35 and
subdivision (f) of Section 36 of Article XIII of the California
Constitution, or any tax levied pursuant to Section 6051 or 6201 that
is deposited in the State Treasury to the credit of the Local
Revenue Fund 2011 pursuant to Section 6051.15 or 6201.15.
(c) If a purchaser certifies in writing to the seller that the
building and construction supplies, materials, equipment, and
machinery, and the parts thereof, purchased without payment of the
tax will be used in a manner entitling the seller to regard the gross
receipts from the sale as exempt from the sales tax, and within one
year from the date of purchase, the purchaser (1) removes the
building and construction supplies, materials, equipment, and
machinery, and the parts thereof, outside California, (2) converts
the building and construction supplies, materials, equipment, and
machinery, and the parts thereof, for use in a manner not qualifying
for the exemption, or (3) uses that building and construction
supplies, materials, equipment, and machinery, and the parts thereof,
in a manner not qualifying for the exemption, the purchaser shall be
liable for payment of sales tax, with applicable interest, as if the
purchaser were a retailer making a retail sale of the building and
construction supplies, materials, equipment, and machinery, and the
parts thereof, at the time the building and construction supplies,
materials, equipment, and machinery, and the parts thereof, are so
removed, converted, or used, and the cost of the building and
construction supplies, materials, equipment, and machinery, and the
parts thereof, to the purchaser shall be deemed the gross receipts
from that retail sale.
(d) For purposes of this section, "persons and families of low
income" has the same meaning as that term is defined in Section 50093
of the Health and Safety Code.
(e) This section shall become inoperative on January 1, 2020, and
as of that date is repealed.
SEC. 2. 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
tax revenues lost by it under this act.
SEC. 2. SEC. 3. This act provides
for a tax levy within the meaning of Article IV of the Constitution
and shall go into immediate effect. However, the provisions of this
act shall become operative on the first day of the first calendar
quarter commencing more than 180 days after the effective date of
this act.
