BILL NUMBER: SB 433 AMENDED
BILL TEXT
AMENDED IN SENATE MAY 7, 2015
AMENDED IN SENATE APRIL 6, 2015
INTRODUCED BY Senator Berryhill
FEBRUARY 25, 2015
An act to amend Sections 7360 and 60050 of the Revenue and
Taxation Code, relating to taxation.
LEGISLATIVE COUNSEL'S DIGEST
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 year and each
fiscal year thereafter to the 2020 -21
fiscal year, inclusive, on or before May 15 of the fiscal year
immediately preceding the applicable fiscal year , 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 year and each
fiscal year thereafter to the 2020 -21
fiscal year, inclusive, on or before May 15 of the fiscal year
immediately preceding the applicable fiscal year , 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 1. Section 7360 of the Revenue and Taxation Code is
amended to read:
7360. (a) (1) A tax of eighteen cents ($0.18) is hereby imposed
upon each gallon of fuel subject to the tax in Sections 7362, 7363,
and 7364.
(2) If the federal fuel tax is reduced below the rate of nine
cents ($0.09) per gallon and federal financial allocations to this
state for highway and exclusive public mass transit guideway purposes
are reduced or eliminated correspondingly, the tax rate imposed by
paragraph (1), on and after the date of the reduction, shall be
recalculated by an amount so that the combined state rate under
paragraph (1) and the federal tax rate per gallon equal twenty-seven
cents ($0.27).
(3) If any person or entity is exempt or partially exempt from the
federal fuel tax at the time of a reduction, the person or entity
shall continue to be so exempt under this section.
(b) (1) On and after July 1, 2010, in addition to the tax imposed
by subdivision (a), a tax is hereby imposed upon each gallon of motor
vehicle fuel, other than aviation gasoline, subject to the tax in
Sections 7362, 7363, and 7364 in an amount equal to seventeen and
three-tenths cents ($0.173) per gallon.
(2) (A) For the 2011-12 fiscal year to the 2015-16 fiscal year,
inclusive, and for the 2021 -2 2
fiscal year and each fiscal year thereafter, the board
shall, on or before March 1 of the fiscal year immediately preceding
the applicable fiscal year, adjust the rate in paragraph (1) in that
manner as to generate an amount of revenue that will equal the amount
of revenue loss attributable to the exemption provided by Section
6357.7, based on estimates made by the board, and that rate shall be
effective during the state's next fiscal year.
(B) For the 2016-17 fiscal year and each fiscal year
thereafter to the 2020 -21 fiscal year,
inclusive , the Department of Finance shall, on or before
March 1 May 15 of the fiscal year
immediately preceding the applicable fiscal year, adjust the rate in
paragraph (1) in that manner as to generate an amount of revenue that
will equal the amount of revenue loss attributable to the exemption
provided by Section 6357.7, based on estimates made by the Department
of Finance, and that rate shall be effective during the state's next
fiscal year.
(3) In order to maintain revenue neutrality for each year,
beginning with the rate adjustment on or before March 1, 2012, the
adjustment under paragraph (2) shall also take into account the
extent to which the actual amount of revenues derived pursuant to
this subdivision and, as applicable, Section 7361.1, the revenue loss
attributable to the exemption provided by Section 6357.7 resulted in
a net revenue gain or loss for the fiscal year ending prior to the
rate adjustment date on or before March 1 or May 15, as
applicable .
(4) The intent of paragraphs (2) and (3) is to ensure that Chapter
6 of the Statutes of 2011, which added this subdivision and Section
6357.7, does not produce a net revenue gain in state taxes.
(5) No later than March 10 May 15 ,
2016, and each March 10 May 15
thereafter to May 15, 2020 , the Department of Finance
shall notify the board of the rate adjustment effective for the state'
s next fiscal year.
SEC. 2. Section 60050 of the Revenue and Taxation Code is amended
to read:
60050. (a) (1) A tax of eighteen cents ($0.18) is hereby imposed
upon each gallon of diesel fuel subject to the tax in Sections 60051,
60052, and 60058.
(2) If the federal fuel tax is reduced below the rate of fifteen
cents ($0.15) per gallon and federal financial allocations to this
state for highway and exclusive public mass transit guideway purposes
are reduced or eliminated correspondingly, the tax rate imposed by
paragraph (1), including any reduction or adjustment pursuant to
subdivision (b), on and after the date of the reduction, shall be
increased by an amount so that the combined state rate under
paragraph (1) and the federal tax rate per gallon equal what it would
have been in the absence of the federal reduction.
(3) If any person or entity is exempt or partially exempt from the
federal fuel tax at the time of a reduction, the person or entity
shall continue to be exempt under this section.
(b) (1) On July 1, 2011, the tax rate specified in paragraph (1)
of subdivision (a) shall be reduced to thirteen cents ($0.13) and
every July 1 thereafter shall be adjusted pursuant to paragraphs (2)
and (3).
(2) (A) For the 2012-13 fiscal year to the 2015-16 fiscal year,
inclusive, and for the 2021 -22 fiscal year and each
fiscal year thereafter, the board shall, on or before March 1
of the fiscal year immediately preceding the applicable fiscal year,
adjust the rate reduction in paragraph (1) in that manner as to
result in a revenue loss attributable to paragraph (1) that will
equal the amount of revenue gain attributable to Sections 6051.8 and
6201.8, based on estimates made by the board, and that rate shall be
effective during the state's next fiscal year.
(B) For the 2016-17 fiscal year and each fiscal year
thereafter to the 2020 -21 fiscal year,
inclusive , the Department of Finance shall, on or before
March 1 May 15 of the fiscal year
immediately preceding the applicable fiscal year, adjust the rate
reduction in paragraph (1) in that manner as to result in a revenue
loss attributable to paragraph (1) that will equal the amount of
revenue gain attributable to Sections 6051.8 and 6201.8, based on
estimates made by the Department of Finance, and that rate shall be
effective during the state's next fiscal year.
(3) In order to maintain revenue neutrality for each year,
beginning with the rate adjustment on or before March 1, 2013, the
adjustment under paragraph (2) shall take into account the extent to
which the actual amount of revenues derived pursuant to Sections
6051.8 and 6201.8 and the revenue loss attributable to this
subdivision resulted in a net revenue gain or loss for the fiscal
year ending prior to the rate adjustment date on or before March 1
or May 15, as applicable .
(4) The intent of paragraphs (2) and (3) is to ensure that Chapter
6 of the Statutes of 2011, which added this subdivision and Sections
6051.8 and 6201.8, does not produce a net revenue gain in state
taxes.
(5) No later than March 10 May 15 ,
2016, and each March 10 May 15
thereafter to May 15, 2020 , the Department of Finance
shall notify the board of the rate adjustment effective for the state'
s next fiscal year