Amended in Senate April 15, 2015

Senate Bill No. 598

Introduced by Senator Hill

February 27, 2015

An act to add begin insert and repeal end insert Section 6018.10 to the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.

LEGISLATIVE COUNSEL’S DIGEST

SB 598, as amended, Hill. Sales and use taxes: consumer designation: all volunteer fire department.

The Sales and Use Tax Law, among other things, imposes a tax on retailers measured by the gross receipts from their sales of tangible personal property sold at retail in this state, and specifies that certain sellers of tangible personal property are consumers, and not retailers, of the tangible personal property they sell.

This bill would provide begin insert , until January 1, 2026, end insert that an all volunteer fire department, as defined, is a consumer, and not a retailer, of all tangible personal property sold by it, if the profits are used solely and exclusively in furtherance of the purposes of the all volunteer fire department, begin insert subject to specified limitations, end insert so that the retail sale subject to tax is the sale of tangible personal property to the all volunteer fire department.

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 begin insert generally end insert in accordance with the Transactions and Use Tax Law, which 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 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, but its operative date would depend on its effective date.

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 6018.10 is added to the Revenue and
Taxation Code, to read:

6018.10.  

(a) An all volunteer fire department is a consumer
of, and shall not be considered a retailer within the provisions of
this part of all tangible personal property sold by it, including, but
not limited to, hot prepared food products and clothing, if the
profits are used solely and exclusively in furtherance of the
purposes of the all volunteer fire department.

(b) For purposes of this section, an “all volunteer fire
department” means an organization that meets all of the following
requirements:

(1) All members shall not be paid a regular salary, but may be
compensated on an hourly or per incident basis.

(2) The purpose of the organization is to protect the lives,
property, and environment within a designated geographical area
from fires, disasters, and emergency incidents through education,
prevention, training, and emergency response.

(3) Is regularly organized for volunteer fire department purposes
that qualifies as an exempt organization, either under Section
23701d or 23701f of this code or under Section 501(c)(3) or
501(c)(4) of the Internal Revenue Code, having official recognition
and full or partial support of the government of the county, city,
or district in which the volunteer fire department is located, and
that has functions having an exclusive connection with the
prevention and extinguishing of fires within the area of the county,
city, or district extending official recognition for the benefit of the
public generally and to lessen the burdens of the entity of
government which would otherwise be obligated to furnish that
fire protection.

begin insert

(c) This section shall not apply if an all volunteer fire
department, in each of the two preceding calendar years, has
receipts from the sale of tangible personal property of one hundred
thousand dollars ($100,000) or more.

end insert begin insert

(d) This section shall remain in effect only until January, 1,
2026, and as of that date is repealed.

end insert

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.
However, the provisions of this act shall become operative on the
first day of the first calendar quarter commencing more than 90
days after the effective date of this act.