SB 433, as amended, Berryhill. Motor vehicle fuel taxes: diesel fuel taxes: rates: adjustments.
Existing law, as of July 1, 2010, exempts the sale of, and the storage, use, or other consumption of, motor vehicle fuel from specified sales and use taxes and increases the excise tax on motor vehicle fuel, as provided.
Existing law requires the State Board of Equalization, for the 2011-12 fiscal year and each fiscal year thereafter, on or before March 1 of the fiscal year immediately preceding the applicable fiscal year, to adjust the motor vehicle fuel tax rate in that manner as to generate an amount of revenue equal to the amount of revenue loss attributable to the sales and use tax exemption on motor vehicle fuel, based on estimates made by the board. Existing law also requires, in order to maintain revenue neutrality, the board to take into account actual net revenue gain or loss for the fiscal year ending prior to the rate adjustment date. Existing law requires this determined rate to be effective during the state’s next fiscal year.
This bill would, for the 2016-17 fiscal yearbegin delete and each fiscal year thereafterend deletebegin insert to the 2020end insertbegin insert-21 fiscal year, inclusive, on or before May 15 of the fiscal year immediately preceding the applicable fiscal yearend insert, instead require the Department of Finance to adjust the motor vehicle fuel tax rate as described above, and would require the department to notify the board of the rate adjustment effective for the state’s next fiscal year, as provided.
Existing law, as of July 1, 2011, increases the taxes on the sale of, and the storage, use, or other consumption of, diesel fuel, and reduces the excise tax on diesel fuel.
Existing law requires the board, for the 2012-13 fiscal year and each fiscal year thereafter, on or before March 1 of the fiscal year immediately preceding the applicable fiscal year, to adjust the diesel fuel tax rate by reducing it in that manner as to result in a revenue loss that will equal the amount of revenue gain attributable to the increase in the sales and use tax rate, based on estimates made by the board. Existing law also requires, in order to maintain revenue neutrality, the board to take into account actual net revenue gain or loss for the fiscal year ending prior to the rate adjustment date. Existing law requires this determined rate to be effective during the state’s next fiscal year.
This bill would, for the 2016-17 fiscal yearbegin delete and each fiscal year thereafterend deletebegin insert
to the 2020end insertbegin insert-21 fiscal year, inclusive, on or before May 15 of the fiscal year immediately preceding the applicable fiscal yearend insert, instead require the Department of Finance to adjust the diesel fuel excise tax rate as described above, and would require the department to notify the board of the rate adjustment effective for the state’s next fiscal year, as provided.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 7360 of the Revenue and Taxation Code
2 is amended to read:
(a) (1) A tax of eighteen cents ($0.18) is hereby imposed
4upon each gallon of fuel subject to the tax in Sections 7362, 7363,
5and 7364.
6(2) If the federal fuel tax is reduced below the rate of nine cents
7($0.09) per gallon and federal financial allocations to this state for
8highway and exclusive public mass transit guideway purposes are
9reduced or eliminated correspondingly, the tax rate imposed by
10paragraph (1), on and after the date of the reduction, shall be
11recalculated by an amount so that the combined state rate under
P3 1paragraph (1) and the federal tax rate per gallon equal twenty-seven
2cents ($0.27).
3(3) If any person or entity is exempt or partially exempt from
4the federal fuel tax at the time of a reduction, the person or entity
5shall continue to be so exempt under this section.
6(b) (1) On and after July 1, 2010, in addition to the tax imposed
7by subdivision (a), a tax is hereby imposed upon each gallon of
8motor vehicle fuel, other than aviation gasoline, subject to the tax
9in Sections 7362, 7363, and 7364 in an amount equal to seventeen
10and three-tenths cents ($0.173) per gallon.
11(2) (A) For the 2011-12 fiscal year to the 2015-16 fiscal year,
12inclusive,begin insert and for the 2021end insertbegin insert-22
fiscal year and each fiscal year
13thereafter,end insert the board shall, on or before March 1 of the fiscal year
14immediately preceding the applicable fiscal year, adjust the rate
15in paragraph (1) in that manner as to generate an amount of revenue
16that will equal the amount of revenue loss attributable to the
17exemption provided by Section 6357.7, based on estimates made
18by the board, and that rate shall be effective during the state’s next
19fiscal year.
20(B) For the 2016-17 fiscal yearbegin delete and each fiscal year thereafterend delete
21begin insert to the 2020end insertbegin insert-21 fiscal year, inclusiveend insert, the Department of
Finance
22shall, on or beforebegin delete March 1end deletebegin insert May 15end insert
of the fiscal year immediately
23preceding the applicable fiscal year, adjust the rate in paragraph
24(1) in that manner as to generate an amount of revenue that will
25equal the amount of revenue loss attributable to the exemption
26provided by Section 6357.7, based on estimates made by the
27Department of Finance, and that rate shall be effective during the
28state’s next fiscal year.
29(3) In order to maintain revenue neutrality for each year,
30beginning with the rate adjustment on or before March 1, 2012,
31the adjustment under paragraph (2) shall also take into account the
32extent to which the actual amount of revenues derived pursuant to
33this subdivision and, as applicable, Section 7361.1, the revenue
34loss attributable to the exemption provided by Section 6357.7
35resulted in a net revenue gain or loss for the fiscal year ending
36prior
to the rate adjustment date on or before March 1begin insert or May 15,
37as applicableend insert.
38(4) The intent of paragraphs (2) and (3) is to ensure that
Chapter
396 of the Statutes of 2011, which added this subdivision and Section
406357.7, does not produce a net revenue gain in state taxes.
P4 1(5) No later thanbegin delete March 10end deletebegin insert May 15end insert, 2016, and eachbegin delete March 10end delete
2begin insert May 15end insert thereafterbegin insert to May 15, 2020end insert, the Department of Finance
3shall notify the board of the rate adjustment effective for the state’s
4next fiscal year.
Section 60050 of the Revenue and Taxation Code is
6amended to read:
(a) (1) A tax of eighteen cents ($0.18) is hereby
8imposed upon each gallon of diesel fuel subject to the tax in
9Sections 60051, 60052, and 60058.
10(2) If the federal fuel tax is reduced below the rate of fifteen
11cents ($0.15) per gallon and federal financial allocations to this
12state for highway and exclusive public mass transit guideway
13purposes are reduced or eliminated correspondingly, the tax rate
14imposed by paragraph (1), including any reduction or adjustment
15pursuant to subdivision (b), on and after the date of the reduction,
16shall be increased by an amount so that the combined state rate
17under paragraph (1) and the federal tax rate per gallon equal what
18it
would have been in the absence of the federal reduction.
19(3) If any person or entity is exempt or partially exempt from
20the federal fuel tax at the time of a reduction, the person or entity
21shall continue to be exempt under this section.
22(b) (1) On July 1, 2011, the tax rate specified in paragraph (1)
23of subdivision (a) shall be reduced to thirteen cents ($0.13) and
24every July 1 thereafter shall be adjusted pursuant to paragraphs
25(2) and (3).
26(2) (A) For the 2012-13 fiscal year to the 2015-16 fiscal year,
27inclusive,begin insert
and for the 2021end insertbegin insert-22 fiscal year and each fiscal year
28thereafter,end insert
the board shall, on or before March 1 of the fiscal year
29immediately preceding the applicable fiscal year, adjust the rate
30reduction in paragraph (1) in that manner as to result in a revenue
31loss attributable to paragraph (1) that will equal the amount of
32revenue gain attributable to Sections 6051.8 and 6201.8, based on
33estimates made by the board, and that rate shall be effective during
34the state’s next fiscal year.
35(B) For the 2016-17 fiscal yearbegin delete and each fiscal year thereafterend delete
36begin insert to the 2020end insertbegin insert-21 fiscal year, inclusiveend insert, the Department of Finance
37shall, on or beforebegin delete March 1end deletebegin insert
May 15end insert of the fiscal year immediately
38preceding the applicable fiscal year, adjust the rate reduction in
39paragraph (1) in that manner as to result in a revenue loss
40attributable to paragraph (1) that will equal the amount of revenue
P5 1gain attributable to Sections 6051.8 and 6201.8, based on estimates
2made by the Department of Finance, and that rate shall be effective
3during the state’s next fiscal year.
4(3) In order to maintain revenue neutrality for each year,
5beginning with the rate adjustment on or before March 1, 2013,
6the adjustment under paragraph (2) shall take into account the
7extent to which the actual amount of revenues derived pursuant to
8Sections 6051.8 and 6201.8 and the revenue loss attributable to
9this subdivision resulted in a net revenue gain or loss for the fiscal
10year ending prior
to the rate adjustment date on or before March
111begin insert or May 15, as applicableend insert.
12(4) The intent of paragraphs (2) and (3) is to ensure that
Chapter
136 of the Statutes of 2011, which added this subdivision and Sections
146051.8 and 6201.8, does not produce a net revenue gain in state
15taxes.
16(5) No later thanbegin delete March 10end deletebegin insert May 15end insert, 2016, and eachbegin delete March 10end delete
17begin insert May 15end insert thereafterbegin insert to May 15, 2020end insert, the Department of Finance
18shall notify the board of the rate adjustment effective for the state’s
19next fiscal year
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