Bill Text: CA SB1210 | 2009-2010 | Regular Session | Amended
Bill Title: Taxation: sweetened beverage tax: Children's Health
Spectrum: Partisan Bill (Democrat 4-0)
Status: (Introduced - Dead) 2010-05-13 - Placed on REV. & TAX. suspense file. [SB1210 Detail]
Download: California-2009-SB1210-Amended.html
BILL NUMBER: SB 1210 AMENDED
BILL TEXT
AMENDED IN SENATE MAY 5, 2010
AMENDED IN SENATE APRIL 14, 2010
INTRODUCED BY Senator Florez
(Principal coauthor: Assembly Member Monning)
(Coauthors: Assembly Members Coto and Torlakson)
FEBRUARY 18, 2010
An act to add Part 14.5 (commencing with Section 32600) to
Division 2 of the Revenue and Taxation Code, relating to taxation, to
take effect immediately, tax levy.
LEGISLATIVE COUNSEL'S DIGEST
SB 1210, as amended, Florez. Taxation: sweetened beverage tax:
Children's Health Promotion Fund.
Existing law imposes various taxes, including taxes on the
privilege of engaging in certain activities. The Fee Collection
Procedures Law, the violation of which is a crime, provides
procedures for the collection of certain fees and surcharges.
This bill would , on and after January 1, 2011,
impose a tax on every distributor, as defined, at the
rate of $0.01 per teaspoon of added caloric sweetener in
bottled sweetened beverage beverages or
concentrate upon every person who makes the first sale in
this state of bottled sweetened beverage or concentrate and on every
person who uses or consumes, or places into a vending machine or
retail stock, untaxed bottled sweetened beverage or concentrate, as
provided sold or offered for sale to a retailer in
this state, or on a retailer who sells bottled sweetened beverages or
concentrate in this state to consumers on which the tax has not been
paid by a distributor . This bill would exempt from the tax
the sale of bottled sweetened beverage that was made with
tax-paid concentrate, as provided, and any sale, use, or
consumption which in this state of bottled
sweetened beverages or concentrate that the state is prohibited
from taxing, as provided. The tax would be administered by the State
Board of Equalization and would be collected pursuant to the
procedures set forth in the Fee Collection Procedures Law.
The bill would require the board to deposit all taxes, penalties,
and interest collected, less refund and administrative costs, in the
Children's Health Promotion Fund, which this bill would create. This
bill would require all moneys in the fund, upon appropriation by the
Legislature, to be allocated to the State Department of Public Health
for distribution of grants to eligible school districts for the
purposes of statewide childhood obesity prevention activities and
programs.
Because this bill would expand the application of the Fee
Collection Procedures Law, the violation of which is a crime, it
would impose a state-mandated local program.
This bill would make legislative findings and declarations
relating to the consumption of sweetened beverages, childhood
obesity, and dental disease.
This bill would result in a change in state taxes for the purpose
of increasing state revenues within the meaning of Section 3 of
Article XIII A of the California Constitution, and thus would
require for passage the approval of 2/3 of the membership of each
house of the Legislature.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
This bill would take effect immediately as a tax levy , but
its operative date would depend on its effective date
.
Vote: 2/3. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. (a) The Legislature finds and
declares that over
SECTION 1. The Legislature finds and declares all
of the following:
(a) Over the past 30 years, there
has been a substantial increase in the prevalence of obesity among
adults in the United States. From the 1960s to the late 1970s,
prevalence was relatively constant, with about 15 percent of the
population classified as obese. After the 1970s these rates began to
climb. By 2006, 23.3 percent of Americans were considered obese. In
California, obesity rates have increased even more, rising from
only a low of 8.9 percent in 1984 to
24.3 percent in 2008. Although no group has escaped the epidemic,
ethnic minorities and the poor are disproportionately affected.
(b) The Legislature further finds that the
rates of overweight among children have also increased dramatically
in recent decades. After being relatively constant from the 1960s to
the 1970s, the prevalence of overweight has more than quadrupled
among children between 6 and 11 years of age and nearly tripled among
those between 12 and 19 years of age. Among California children in
grades 5, 7, and 9, 28 percent are overweight, including 34 percent
of boys and 22 percent of girls, with rates in some communities much
higher.
(c) The Legislature further finds that the
obesity epidemic is of particular concern because it increases the
risk of diabetes, heart disease, certain types of cancer, arthritis,
asthma, and breathing problems. Depending on their level of obesity,
from 60 percent to over 80 percent of obese adults have type 2
diabetes, high blood cholesterol, high blood pressure, or other
related conditions. It has been reported that up to 60 percent of
obese children aged 5 to 10 years of age have
early signs of heart disease.
(d) The Legislature further finds that type
Type 2 diabetes, previously only seen among adults, is now
increasing among children. If the current obesity trends are not
reversed, it is predicted that one in three children and nearly
one-half of Latino and African American children born in the year
2000 will develop type 2 diabetes in their lifetime. Research shows
that overweight children have a much greater chance of being obese as
adults, with all the health risks that entails.
(e) The Legislature further finds that overweight
Overweight and obesity account for $147 billion
in health care costs nationally, or 9 percent of all medical
spending, per year.
(f) The Legislature further finds that in
In 2006 overweight and obesity-related costs in California were
estimated at almost $21 billion.
(g) The Legislature further finds that there
There is overwhelming evidence of the link
between obesity and consumption of sweetened beverages such as soft
drinks, energy drinks, sweet teas, and sports drinks. California
adults who drink a soda or more per day are 27 percent more likely to
be overweight or obese, regardless of income or ethnicity.
(h) The Legislature further finds that according
According to nutritional experts, sweetened
beverages such as soft drinks, energy drinks, sweet teas, and sports
drinks offer little or no nutritional value but massive quantities of
added sugars. For example, a 20-ounce bottle of soda contains the
equivalent of approximately 17 teaspoons of sugar. Yet, the American
Heart Association recommends that Americans consume no more than five
to nine teaspoons of sugar per day.
(i) The Legislature further finds that research
Research shows that almost one-half of the extra calories
Americans have been consuming since the 1970s could come from soda,
with the average American drinking nearly 50 gallons of sweetened
beverages a year, the equivalent of 39 pounds of extra sugar every
year.
(j) The Legislature further finds that
Americans are drinking more sweetened beverages than ever before.
From 1977 to 2002, Americans doubled the amount of sweetened
beverages they consumed. Currently, children and adult Americans
consume 172 and 175 calories respectively from sweetened beverages a
day. Children and adolescents now consume 10 to 15 percent of their
daily caloric intake from sweetened beverages.
(k) The Legislature further finds that research
Research shows that 41 percent of California children 2
to 11 years of age and 62 percent of California teens 12 to 17 years
of age drink soda daily and for every additional serving of sweetened
beverage that a child consumes a day, the likelihood of the child
becoming obese increases by 60 percent.
(l) Dental caries (tooth decay) is the most common chronic
childhood disease, experienced by more than two-thirds of California'
s children. Children who frequently or excessively consume beverages
high in sugar are at increased risk for dental caries. Untreated
dental caries can lead to pain, infection, tooth loss and in severe
cases, even death. It can slow normal growth and development by
restricting nutritional intake. Children who are missing teeth may
have chewing problems that limit their food choices and result in
nutritionally inadequate diets.
(m) It is the intent of the Legislature, by adopting the Sweetened
Beverage Tax Law and creating the Children's Health Promotion Fund,
to diminish the human and economic costs of obesity and dental
disease. This act is intended to discourage excessive consumption of
sweetened beverages by increasing the price of these products and by
creating a dedicated revenue source for programs designed to prevent
and treat childhood obesity and dental disease and reduce the burden
of attendant health conditions.
SEC. 2. Part 14.5 (commencing with Section 32600) is added to
Division 2 of the Revenue and Taxation Code, to read:
PART 14.5. SWEETENED BEVERAGE TAX LAW
32600. This part shall be known and may be cited as the Sweetened
Beverage Tax Law.
32601. For purposes of this part:
(a) "Beverage container" means any closed or sealed glass, metal,
paper, plastic, or any other type of container regardless of the size
or shape of the container.
(b) "Bottled sweetened beverage" means a sweetened beverage
contained in a beverage container.
(c) "Caloric sweetener" means any caloric substance suitable for
human consumption that humans perceive as sweet and includes, without
limitation, sucrose, fructose, including high fructose corn
sweetener, glucose, other sugars, and fruit juice concentrates.
For purposes of this subdivision, "caloric"
"Caloric sweetener" excludes noncaloric sweeteners. "Caloric"
means a substance that adds calories to the diet of a person who
consumes that substance.
(d) "Concentrate" means a sweetened beverage syrup, simple syrup,
powder, or base product for mixing, compounding, or making sweetened
beverages.
(e) "Concentrate manufacturer" means any person that manufactures
concentrate for sale to distributors, dealers, consumers, or others
in this state.
(e) "Consumer" means a person who purchases a bottled sweetened
beverage or concentrate for consumption and not for resale.
(f) "Distributor" means any person, including a manufacturer and
wholesale dealer, who receives, stores, manufactures, bottles, or
distributes bottled sweetened beverages or concentrate to retailers
doing business in the state whether or not that person also sells
these products to consumers.
(f)
(g) "Medical food" means medical food as defined in
Section 109971 of the Health and Safety Code.
(g)
(h) "Milk" means natural liquid milk, regardless of
animal source or butterfat content, natural milk concentrate, whether
or not reconstituted, regardless of animal source or butterfat
content, or dehydrated natural milk, whether or not reconstituted.
(h)
(i) "Natural fruit juice" means the original liquid
resulting from the pressing of fruit, the liquid resulting from the
reconstitution of natural fruit juice concentrate, or the liquid
resulting from the restoration of water to dehydrated natural fruit
juice.
(i)
(j) "Natural vegetable juice" means the original liquid
resulting from the pressing of vegetables, the liquid resulting from
the reconstitution of natural vegetable juice concentrate, or the
liquid resulting from the restoration of water to dehydrated natural
vegetable juice.
(j)
(k) "Nonalcoholic beverage" means all
beverages any beverage not subject to tax under
Part 14 (commencing with Section 32001).
(l) "Noncaloric sweetener" means any noncaloric substance suitable
for human consumption that humans perceive as sweet and includes,
without limitation, aspartame, saccharin, stevia, and sucralose.
"Noncaloric" means a substance that does not add calories to the diet
of a person who consumes the substance.
(m) "Person" means an individual, trust, firm, joint stock
company, business concern, corporation, including, but not limited
to, a government corporation, partnership, limited liability company,
and association. "Person" also includes any city, county, city and
county, district, commission, the state, or any department, agency,
or political subdivision thereof, any interstate body, and the United
States and its agencies and instrumentalities to the extent
permitted by law.
(k)
(n) (1) "Powder" or "base product" means a mixture of
ingredients in other than liquid form, used in making, mixing, or
compounding sweetened beverages by mixing this product with water,
ice, syrup, or simple syrup, fruits, vegetables, fruit juice,
vegetable juice, or any other product suitable to make a sweetened
beverage.
(2) "Powder" or "base product" does not include any of the
following:
(A) Any product sold in powder or other nonliquid mixture form
that is solely used in preparing coffee or tea.
(B) Any product sold in powder form for consumption by infants and
which is commonly referred to as "infant formula."
(C) Any product sold in powder form for use for weight reduction.
(D) Any product containing milk or milk products or plant
protein sources .
(E) Any frozen concentrate or freeze-dried concentrate to which
only water is added to produce a sweetened beverage containing more
than 10 percent natural fruit juice or more than 10 percent natural
vegetable juice.
(F) Any powder or other base product that is sold and used for the
purpose of an individual consumer mixing a sweetened beverage.
(G) Medical food.
(o) "Retailer" means any person who sells in this state bottled
sweetened beverages or concentrate to consumers whether or not that
person is also a distributor as defined in this section.
(l)
(p) "Sale" means the transfer of title or possession
for consideration in any manner or by any means whatever.
(m)
(q) "Simple syrup" means a mixture of sugar and water.
(n)
(r) (1) "Sweetened beverage" means any sweetened
nonalcoholic beverage sold for human consumption that contains
any added caloric sweeteners, including, but not limited to,
the following: soda water, ginger ale, root beer, all beverages
commonly referred to as cola, lime, lemon, lemon-lime, and other
flavored beverages, including any fruit or vegetable beverage
containing 10 percent or less natural fruit juice or natural
vegetable juice, and all other drinks and beverages commonly referred
to as "soda," "soda pop," and "soft drinks."
(2) "Sweetened beverage" does not include any of the following:
(A) Any nonalcoholic beverage sweetened entirely with
sweeteners that do not add calories to the beverage.
noncaloric sweetener.
(B) Any product sold in liquid form for consumption by infants,
which is commonly referred to as "infant formula."
(C) Any product sold in liquid form for use for weight reduction.
(D) Water, to which no caloric sweeteners have been added.
(E) Any product containing milk or milk products or plant
protein sources .
(F) Medical food.
(o) "Sweetened beverage manufacturer" means any person who
bottles, cans, or otherwise fills bottled sweetened beverages, or
imports bottled sweetened beverages.
(p)
(s) "Syrup" means the liquid mixture of ingredients
used in making, or mixing, compounding sweetened beverages by mixing
the syrup with water, simple syrup, ice, fruits, vegetables, fruit
juice, vegetable juice, or any other product suitable to make a
sweetened beverage.
(q)
(t) "Teaspoon" means 4.2 grams.
32602. (a) On and after January 1, 2011, a tax is hereby imposed
at the rate of one cent ($0.01) per teaspoon of caloric sweetener in
a bottled sweetened beverage on every person who does the following:
(1) Makes the first sale in this state of a bottled sweetened
beverage.
(2) Uses or consumes an untaxed bottled sweetened beverage in this
state.
(3) Places in this state an untaxed bottled sweetened beverage in
a vending machine or in retail stock for the purpose of selling the
bottled sweetened beverage to consumers.
(b) On and after January 1, 2011, a tax is hereby imposed at the
rate of one cent ($0.01) per teaspoon of caloric sweetener in the
concentrate on every person who does the following:
(1) Makes the first sale in this state of concentrate.
(2) Uses or consumes untaxed concentrate in this state.
(3) Places in this state untaxed concentrate in a vending machine
or retail stock for the purpose of selling a sweetened beverage to
consumers.
(c) There is exempt from the tax imposed under subdivision (a),
the sale of bottled sweetened beverage, provided that the bottled
sweetened beverage was made with concentrate on which the tax imposed
under subdivision (b) was paid.
32602. (a) There is hereby imposed a tax on every distributor at
the rate of one cent ($0.01) per teaspoon of added caloric sweetener
in a bottled sweetened beverage or concentrate sold or offered for
sale to a retailer in this state.
(b) A retailer who sells bottled sweetened beverages or
concentrate in this state to a consumer, on which the tax imposed by
this section has not been paid by a distributor, is liable for the
tax imposed in subdivision (a) at the time of sale to a consumer.
(c) Every distributor subject to the tax imposed pursuant to
subdivision (a) shall separately state the amount of tax due to the
board by the distributor on the receipt, invoice, or other form of
accounting of the transaction given to the retailer.
32603. There is exempt from the tax imposed by this part, the
sale, use, or consumption in this state of bottled sweetened
beverages or concentrates where the state is prohibited from taxing
that sale, use, or consumption under the Constitution or laws of the
United States or under the Constitution of this state.
32604. (a) The board shall administer and
collect the tax imposed by this part pursuant to the Fee Collection
Procedures Law (Part 30 (commencing with Section 55001)). For
purposes of this part, the references in the Fee Collection
Procedures Law to "fee" shall include the tax imposed by this part
and references to "feepayer" shall include a person required to pay
the tax imposed by this part.
(b) (1) The board may prescribe, adopt, and enforce regulations
relating to the administration and enforcement of this part,
including, but not limited to, collections, reporting, refunds, and
appeals.
(2) The board may prescribe, adopt, and enforce any emergency
regulations as necessary to implement this part. Any emergency
regulation prescribed, adopted, or enforced pursuant to this section
shall be adopted in accordance with Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code, and, for purposes of that chapter, including Section 11349.6 of
the Government Code, the adoption of the regulation is an emergency
and shall be considered by the Office of Administrative Law as
necessary for the immediate preservation of the public peace, health
and safety, and general welfare.
32605. Each person required to pay the tax shall prepare and
32605. (a) Each person required to pay the tax
imposed under this part shall register with the board. Every
application for registration shall be made upon a form prescribed by
the board and shall set forth the name under which the applicant
transacts or intends to transact business, the location of his or her
place or places of business, and any other information as the board
may require. An application for an account shall be authenticated in
a form or pursuant to a method as may be prescribed by the board.
(b) Each person required to pay the tax
shall prepare and file with the board a return using
electronic media in the form prescribed by the board containing
information as the board deems necessary or appropriate for the
proper administration of this part. The return shall be filed on or
before the last day of the calendar month following the calendar
quarter to which it relates, together with a remittance payable to
the board for the amount of tax due for that period. Returns
shall be authenticated in a form or pursuant to a method as may be
prescribed by the State Board of Equalization.
32606. The board may prescribe those forms and reporting
requirements as are necessary to implement the tax, including, but
not limited to, information regarding the total amount of caloric
sweetener, the total amount of bottled sweetened beverages and
concentrate sold, and the amount of tax due.
32607. Every payment on a delinquent tax owed pursuant to this
part shall be applied as follows:
(a) First, to any interest due on the tax.
(b) Second, to any penalty imposed by this part.
(c) Third, the balance, if any, to the tax due.
32608. The board shall, upon appropriation, be reimbursed for
expenses incurred in the administration and collection of the tax
imposed by this part.
32609. (a) There is hereby created a trust fund in the State
Treasury called the Children's Health Promotion Fund. The Children's
Health Promotion Fund shall consist of all taxes, interest,
penalties, and other amounts collected pursuant to this part, less
refunds and reimbursement to the board for expenses incurred in the
administration and collection of the tax.
(b) All moneys in the Children's Health Promotion Fund shall, upon
appropriation by the Legislature, be allocated for the purposes of
statewide childhood obesity prevention activities and programs.
SEC. 3. No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.
SEC. 4. This act provides for a tax levy within
the meaning of Article IV of the Constitution and shall go into
immediate effect.
SEC. 4. 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 6 months after the effective date of this act.
