Amended in Assembly March 28, 2016

California Legislature—2015–16 Regular Session

Assembly BillNo. 2673


Introduced by Assembly Member Harper

(Coauthors: Assembly Members Steinorth and Wilk)

February 19, 2016


An act to add Section 6377.5 to, and to add and repeal Sections 17053.55 and 23655 of, the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.

LEGISLATIVE COUNSEL’S DIGEST

AB 2673, as amended, Harper. Sales and use tax exemption: income taxbegin delete creditsend deletebegin insert credits:end insert hydrogen refueling station equipment.

(1) Existing sales and use tax laws impose 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. Existing law provides various exemptions from the taxes imposed by those laws.

This bill, on and after January 1, 2017, and before January 1, 2030, would exempt from those taxes the gross receipts from the sale of, and the storage, use, or other consumption in this state of, hydrogen refueling station equipment, as defined, purchased by a recipient of a grant pursuant to the Alternative and Renewable Fuel and Vehicle Technology Program for the development of hydrogen refueling stations.

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, whichbegin insert generallyend insert 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.

(2) The Personal Income Tax Law and the Corporation Tax Law allow various credits against the taxes imposed by those laws.

This bill would allow to a grant recipient described above a credit against those taxes for the taxable years beginning on or after January 1, 2016, and before January 1, 2017, for an amount equal to the sum of the sales taxbegin delete reimbursementend deletebegin insert reimbursementsend insert or use taxes previously paid by a grant recipient for hydrogen refueling station equipment during the period from January 1, 2014, to January 1, 2017,begin delete inclusive,end delete as provided. The bill would repeal these provisions as of December 1, 2017.

(3) 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:

P2    1

SECTION 1.  

Section 6377.5 is added to the Revenue and
2Taxation Code
, to read:

3

6377.5.  

(a) On and after January 1, 2017, there are exempted
4from the taxes imposed by this part the gross receipts from the sale
5of, and the storage, use, or other consumption in this state of,
6hydrogen refueling station equipment to or by a qualified grant
7recipient before January 1, 2030.

8(b) As used in this section, the following definitions shall apply:

9(1) “Qualified grant recipient” means a person who has received
10a grant pursuant to Section 44272 of the Health and Safety Code
11for the development of hydrogen refueling stations within this
12state.

13(2) “Hydrogen refueling station” means any motor vehicle
14fueling station which provides hydrogen fuel, either exclusively
P3    1or concurrently with other motor vehicle fuels, for use by fuel cell
2electric vehicles.

3(3) begin delete“Hydrogren end deletebegin insertend insertbegin insertHydrogen end insertrefueling station equipment” means
4any of the following:

5(A) Equipment, including, but not limited to, machinery,
6devices, contrivances, and component, repair, or replacement parts,
7whether purchased separately or in conjunction with a complete
8machine and regardless of whether the equipment or component
9parts are assembled by the grant recipient or another party, to be
10located at a hydrogen refueling station within this state and used
11exclusively for the distribution, dispensing, storage, or production
12of hydrogen fuel for fuel cell electric vehicles, including, but not
13limited to, pressurized storage, compression, pre-cooling, and
14pumping of hydrogen fuel.

15(B) Personal property that is software or software services,
16regardless of location, and computer, computer-type, or data
17processing hardware or hardware services, regardless of location,
18that is used exclusively for the distribution,begin insert dispensing,end insert storage,
19or production of hydrogen fuelbegin insert at a hydrogen refueling stationend insert for
20fuel cell electric vehicles.

21(C) Any other personal property required to operate, control,
22regulate, or maintain the hydrogen refueling station equipment set
23forth in subparagraph (A) or (B).

24(4) “Fuel cell” means a device that directly or indirectly creates
25electricity through an electrochemical process using hydrogen, or
26begin delete hydgrogen-rich,end deletebegin insert hydrogen-rich,end insert fuel and oxygen or another
27oxidizing agent.

28

SEC. 2.  

Section 17053.55 is added to the Revenue and Taxation
29Code
, to read:

30

17053.55.  

(a) For the taxable years beginning on or after
31January 1, 2016, and before January 1, 2017, there shall be allowed
32to a qualified grant recipient a credit against the “net tax,” as
33defined in Section 17039, for the taxable year, in an amount equal
34to the sum of sales tax reimbursements and use taxes previously
35paid during the period from January 1, 2014, to January 1, 2017,
36by the qualified grant recipient for hydrogenbegin insert refuelingend insert station
37
begin delete refueling equipment that is placed in service during that period.end delete
38
begin insert equipment.end insert

P4    1(b) For the purposes of this section, the terms “qualified grant
2recipient” and “hydrogenbegin insert refuelingend insert stationbegin delete refuelingend delete equipment”
3have the same meanings as specified in Section 6377.5.

4(c) In the case of a pass-thru entity, a credit under this section
5shall be allowed to the pass-thru entity and passed through to the
6partners or shareholders in accordance with the applicable
7provisions of this part. As used in this subdivision, “pass-thru
8entity” means any partnership or “S” corporation.

9(d) If a credit otherwise allowed by this section exceeds the “net
10tax” for the taxable year, that portion of the credit that exceeds the
11“net tax” may be carried over and added to the credit in the
12succeeding taxable years, if necessary, until the credit is exhausted.

13(e) The Franchise Tax Board may prescribe rules, guidelines,
14or procedures necessary or appropriate to carry out the purposes
15of this section. Chapter 3.5 (commencing with Section 11340) of
16Part 1 of Division 3 of Title 2 of the Government Code shall not
17apply to any rule, guideline, or procedure prescribed by the
18Franchise Tax Board pursuant to this section.

19(f) Section 41 does not apply to the credit allowed by this
20section.

21(g) This section shall remain in effect only until December 1,
222017, and as of that date is repealed.

23

SEC. 3.  

Section 23655 is added to the Revenue and Taxation
24Code
, to read:

25

23655.  

(a) For the taxable years beginning on or after January
261, 2016, and before January 1, 2017, there shall be allowed to a
27qualified grant recipient a credit against the “tax,” as defined in
28Section 23036, for the taxable year in an amount equal to the sum
29of sales tax reimbursements and use taxes previously paid during
30the period from January 1, 2014, to January 1, 2017, by the
31qualified grant recipient for hydrogenbegin insert refuelingend insert stationbegin delete refueling
32equipment that is placed in service during that period.end delete
begin insert equipment.end insert

33(b) For the purposes of this section, the terms “qualified grant
34recipient” and “hydrogenbegin insert refuelingend insert stationbegin delete refuelingend delete equipment”
35have the same meanings as specified in Section 6377.5.

36(c) In the case of a pass-thru entity, a credit under this section
37shall be allowed to the pass-thru entity and passed through to the
38partners or shareholders in accordance with the applicable
39provisions of this part. As used in this subdivision, “pass-thru
40entity” means any partnership.

P5    1(d) If a credit otherwise allowed by this section exceeds the
2“tax” for the taxable year, that portion of the credit that exceeds
3the “tax” may be carried over and added to the credit in the
4succeeding taxable years, if necessary, until the credit is exhausted.

5(e) The Franchise Tax Board may prescribe rules, guidelines,
6or procedures necessary or appropriate to carry out the purposes
7of this section. Chapter 3.5 (commencing with Section 11340) of
8Part 1 of Division 3 of Title 2 of the Government Code shall not
9apply to any rule, guideline, or procedure prescribed by the
10Franchise Tax Board pursuant to this section.

11(f) Section 41 does not apply to the credit allowed by this
12section.

13(g) This section shall remain in effect only until December 1,
142017, and as of that date is repealed.

15

SEC. 4.  

Notwithstanding Section 2230 of the Revenue and
16Taxation Code, no appropriation is made by this act and the state
17shall not reimburse any local agency for any sales and use tax
18revenues lost by it under this act.

19

SEC. 5.  

This act provides for a tax levy within the meaning of
20Article IV of the Constitution and shall go into immediate effect.



O

    98