BILL NUMBER: AB 781	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Bocanegra

                        FEBRUARY 21, 2013

   An act to add Sections 7153.6 and 55363.5 to the Revenue and
Taxation Code, relating to taxation.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 781, as introduced, Bocanegra. Sales and use taxes: fees:
administration: violations for noncompliance: sales suppression
devices.
   Existing law requires the payment of taxes, fees, and surcharges
that are administered by the State Board of Equalization under the
provisions of the Sales and Use Tax Law and the Fee Collection
Procedures Law, as prescribed.
   This bill would, under those laws, provide that a person who
knowingly sells, purchases, installs, transfers, or possesses in this
state any automated sales suppression device or zapper or
phantom-ware is guilty of a felony punishable by imprisonment for
one, 3, or 5 years, and by a fine of not more than $100,000. This
bill would also provide that the person is liable for all taxes,
interest, and penalties due as the result of the use of an automated
sales suppression device or zapper or phantom-ware and is required to
forfeit to the state all profits associated with the sale or use of
an automated sales suppression device or zapper or phantom-ware. By
creating a new crime, this bill would impose a state-mandated local
program.
   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.
   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.  Section 7153.6 is added to the Revenue and Taxation
Code, to read:
   7153.6.  (a) Notwithstanding any other provision of this part, a
person who knowingly sells, purchases, installs, transfers, or
possesses in this state any automated sales suppression device or
zapper or phantom-ware is guilty of a felony punishable by
imprisonment pursuant to subdivision (h) of Section 1170 of the Penal
Code for one, three, or five years, and by a fine of not more than
one hundred thousand dollars ($100,000). In addition, the person
shall be liable for all taxes, interest, and penalties due as the
result of the use of an automated sales suppression device or zapper
or phantom-ware and shall forfeit to the state all profits associated
with the sale or use of an automated sales suppression device or
zapper or phantom-ware.
   (b) For purposes of this section:
   (1) "Automated sales suppression device" or "zapper" means a
software program carried on a memory stick or removable compact disc,
accessed through an Internet link, or accessed through any other
means, that falsifies the electronic records of electronic cash
registers and other point-of-sale systems, including, but not limited
to, transaction data and transaction reports.
   (2) "Electronic cash register" means a device that keeps a
register or supporting documents through the means of an electronic
device or computer system designed to record transaction data for the
purpose of computing, compiling, or processing retail sales
transaction data in whatever manner.
   (3) "Phantom-ware" means a hidden, preinstalled, or installed at a
later time programming option embedded in the operating system of an
electronic cash register or hardwired into the electronic cash
register that can be used to create a virtual second till or may
eliminate or manipulate transaction records that may or may not be
preserved in digital formats to represent the true or manipulated
record of transactions in the electronic cash register.
   (4) "Transaction data" includes information regarding items
purchased by a customer, the price for each item, a taxability
determination for each item, a segregated tax amount for each of the
taxed items, the amount of cash or credit tendered, the net amount
returned to the customer in change, the date and time of the
purchase, the name, address, and identification number of the vendor,
and the receipt or invoice number of the transaction.
  SEC. 2.  Section 55363.5 is added to the Revenue and Taxation Code,
to read:
   55363.5.  (a) Notwithstanding any other provision of this part, a
person who knowingly sells, purchases, installs, transfers, or
possesses in this state any automated sales suppression device or
zapper or phantom-ware is guilty of a felony punishable by
imprisonment pursuant to subdivision (h) of Section 1170 of the Penal
Code for one, three, or five years, and by a fine of not more than
one hundred thousand dollars ($100,000). In addition, the person
shall be liable for all fees, interest, and penalties due as the
result of the use of an automated sales suppression device or zapper
or phantom-ware and shall forfeit to the state all profits associated
with the sale or use of an automated sales suppression device or
zapper or phantom-ware.
   (b) For purposes of this section:
   (1) "Automated sales suppression device" or "zapper" means a
software program carried on a memory stick or removable compact disc,
accessed through an Internet link, or accessed through any other
means, that falsifies the electronic records of electronic cash
registers and other point-of-sale systems, including, but not limited
to, transaction data and transaction reports.
   (2) "Electronic cash register" means a device that keeps a
register or supporting documents through the means of an electronic
device or computer system designed to record transaction data for the
purpose of computing, compiling, or processing retail sales
transaction data in whatever manner.
   (3) "Phantom-ware" means a hidden, preinstalled, or installed at a
later time programming option embedded in the operating system of an
electronic cash register or hardwired into the electronic cash
register that can be used to create a virtual second till or may
eliminate or manipulate transaction records that may or may not be
preserved in digital formats to represent the true or manipulated
record of transactions in the electronic cash register.
   (4) "Transaction data" includes information regarding items
purchased by a customer, the price for each item, a taxability
determination for each item, a segregated tax or fee amount for each
of the items subject to the tax or fee, the amount of cash or credit
tendered, the net amount returned to the customer in change, the date
and time of the purchase, the name, address, and identification
number of the vendor, and the receipt or invoice number of the
transaction.
  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.