BILL NUMBER: AB 1021	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MAY 7, 2015
	AMENDED IN ASSEMBLY  MARCH 26, 2015

INTRODUCED BY   Assembly Member Steinorth
    (   Coauthors:   Assembly Members 
 Lackey,   Mayes,   and Obernolte   )

    (   Coauthors:   Senators  
Anderson   and Runner  ) 

                        FEBRUARY 26, 2015

   An act to add Section  6012.4   6012.10 
to the Revenue and Taxation Code, relating to taxation, to take
effect immediately, tax levy.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 1021, as amended, Steinorth. Sales and use taxes: smartphones:
bundled transactions.
   The Sales and Use Tax Law imposes a tax 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. Under
existing sales and use tax regulations, gross receipts from a retail
sale of a smartphone sold in a bundled transaction with wireless
telecommunication service is generally equal to the amount of the
unbundled sales price of the smartphone.
   This bill would, instead, limit the gross receipts from a retail
sale of a smartphone sold in a bundled transaction with wireless
telecommunication service to the bundled sales price of the
smartphone.
   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. Amendments 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.
   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  6012.4   6012.10  is
added to the Revenue and Taxation Code, to read:
    6012.4.   6012.10.   (a)
Notwithstanding Sections 6011 and 6012, "gross receipts" and "sales
price" from the retail sale or purchase of a smartphone shall be
limited to the amount charged for the sale of the smartphone when
that smartphone is sold in a bundled transaction.
   (b) "Bundled transaction" means a retail sale of a smartphone that
contractually requires  the   a  retailer'
s customer to activate or contract with a wireless telecommunications
service provider for utility service for a period greater than one
month as a condition of that sale.
   (c) (1) "Smartphone" means a cellular radio telephone or other
mobile voice communications handset device that includes all of the
following features:
   (A) Utilizes a mobile operating system.
   (B) Possesses the capability to utilize mobile software
applications, access and browse the Internet, utilize text messaging,
utilize digital voice service, and send and receive email.
   (C) Has wireless network connectivity.
   (D) Is capable of operating on a long-term evolution network or
successor wireless data network communication standards.
   (2) A "smartphone" does not include a radio cellular telephone
commonly referred to as a "feature" or "messaging" telephone, a
laptop, a tablet device, or a device that only has electronic reading
capability.
   (d) "Wireless telecommunications service provider" means a utility
regulated by the Public Utilities Commission or Federal
Communication Commission and that offers or provides wireless
communication or paging services.
  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. 3.   This act provides for a tax levy within the meaning of
Article IV of the Constitution and shall go into immediate effect.