BILL ANALYSIS
SENATE REVENUE & TAXATION COMMITTEE
Senator Jack Scott, Chair
SB 430 - Vincent
Amended: April 23, 2001
Tax Levy
Hearing: April 25, 2001 Fiscal: Yes
SUBJECT: Provides a 100% credit, up to $100, for spaying
and neutering of pets.
EXISTING LAW
Provides various tax credits designed to provide tax
relief for taxpayers who incur certain expenses such as
adoption or to influence behavior such as business
practices and decisions. These credits generally are
designed to provide incentive for taxpayers to perform
various actions or activities that they may not otherwise
undertake. There is no existing law that provides any type
of tax benefit for spaying and neutering an animal.
THIS BILL
Provides a credit for the cost of spaying or neutering a
cat or dog that is purchased or adopted by a taxpayer.
Costs are limited to the actual costs of the spaying or
neutering operation and cannot exceed $100 per dog or cat,
specifically:
Allows the credit for a dog or cat purchased from a
breeder or pet store located in the State or purchased
or adopted from an animal control agency or shelter,
society for the prevention of cruelty to animals
shelter, humane society shelter, or rescue group.
Requires the dog or cat to be adopted or purchased
after January 1, 2001 and before January 1, 2006.
Defines a breeder as a person who breeds a dog that
is registered with the American Kennel Club or a cat
that is registered with either the International Cat
Association, the Canadian Cat Association, or the Cat
Fanciers' Association.
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Requires the taxpayer to provide the Franchise Tax
Board with an adoption certificate or receipt of
purchase, a certificate of spaying or neutering from a
licensed veterinarian, and a delineation of costs.
Allows any unused credit to be carried over for
eight years.
Sunsets this program on January 1, 2006.
As a tax levy, becomes effective immediately.
FISCAL EFFECT:
According to the Franchise Tax Board, the projected amount
of revenue loss associated with this bill is approximately
$7 million annually, beginning in 2001-02.
COMMENTS:
A. Purpose of the bill
According to the supporters of this bill, the tax credit
provides a new way to encourage people to spay and neuter
their dogs and cats. "We believe that this will be one
more step forward toward solving the problem described as
'too many pets, not enough homes.'"
B. Background
The projected number of animals adopted from an animal
shelter or nonprofit animal welfare organization in
California in 2002 is approximately 200,000. The
approximate number of pets purchased from private
breeders, based on an estimate by the American Kennel
Club is 70,000 annually. The average cost of a spay or
neuter procedure is $30.
The American Society for Prevention of Cruelty to
Animal's (ASPCA) stated policy is to "spay or neuter all
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animals available for adoption in order to control pet
overpopulation." Many local SPCA's offer "Litter Free
Spay Projects" that make spaying or neutering available
at no charge to people who could not otherwise afford it:
seniors on fixed incomes, referrals by local social
service agencies.
This bill does not apply to pets acquired from friends or
found as strays. According to SEAACA, statistics have
shown that these are the main source of pets in the home.
Statistics on pet overpopulation: in seven years, a
female cat and her offspring can produce 420,000 kittens;
a female dog and her offspring can produce 67,000 puppies
in six years. One in five of these animals will be
placed in a home.
C. Unrestrained Growth
This bill does not target a specific group, such as
low-income people, as tax credits often do. The credit
proposed in this bill could become a credit for people
who do not need it. Additionally, exact numbers are not
known on pet adoptions in this state. Although FTB uses
the best available data, it is possible that this bill
would have a larger than anticipated General Fund Impact.
D. Retroactive Incentive?
The bill would allow the credit to be claimed for spaying
and neutering expenses starting with the 2001 taxable
year. The bill should probably be amended to apply to
costs incurred on or after the effective date of the
bill, since any expenses incurred before that date
presumably did not need this additional incentive.
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Support and Opposition
Support:SEAACA (if amended)
Contra Costa Humane Society
Doris Day Animal League
Pets in Need
Pet Industry Joint Advisory Committee (PIJAC)
California Federation for Animal Legislation
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Consultant: Gayle Miller
04/26/:1 09:57