BILL NUMBER: AB 563	CHAPTERED  09/07/99

	CHAPTER   361
	FILED WITH SECRETARY OF STATE   SEPTEMBER 7, 1999
	APPROVED BY GOVERNOR   SEPTEMBER 7, 1999
	PASSED THE SENATE   AUGUST 25, 1999
	PASSED THE ASSEMBLY   MAY 13, 1999

INTRODUCED BY   Assembly Member Honda
   (Coauthors:  Assembly Members Alquist, Cunneen, Havice, Keeley,
Leach, Lempert, Longville, Strom-Martin, Washington, and Wayne)
   (Coauthors: Senators Bowen and O'Connell)

                        FEBRUARY 19, 1999

   An act to add Section 6010.40 to the Revenue and Taxation Code,
relating to taxation, to take effect immediately, tax levy.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 563, Honda.  Sales and use taxes:  exemptions:  animal shelter
or nonprofit animal welfare organization:  transfer of animal.
   The Sales and Use Tax Law imposes a tax on the gross receipts from
the sale in this state of, or the storage, use, or other consumption
in this state of, tangible personal property.  That law provides
various exemptions from that tax.
   This bill would enact the Pet Adoption Sales and Use Tax Relief
Act of 1999, which would exclude from the terms "sale" and "purchase,"
and thereby exempt from state and local sales and use taxes, any
animal when transferred by a city, county, city and county, or other
local government animal shelter or nonprofit animal welfare
organization, as specified, to an individual for use as a pet.
   Counties and cities are authorized to impose local sales and use
taxes in conformity with state sales and use taxes.  Exemptions from
state sales and use taxes enacted by the Legislature are incorporated
into the local taxes.
   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.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  This act shall be known as the Pet Adoption Sales and
Use Tax Relief Act of 1999.
  SEC. 2.  Section 6010.40 is added to the Revenue and Taxation Code,
to read:
   6010.40.  "Sale" and "purchase," for the purpose of this part, do
not include the transfer by a city, city and county, county, or other
local government animal shelter or a nonprofit animal welfare
organization of any animal to an individual for use as a pet, or any
charges made by the government shelter or nonprofit organization for
services in connection with the transfer of that animal, including,
but not limited to, the spaying or neutering or future spaying or
neutering of the animal, or any vaccination, future vaccination, or
similar service.  For purposes of this section, "nonprofit animal
welfare organization" means any organization formed and operated for
the primary purpose of prevention of abuse, neglect, or exploitation
of animals and that qualifies for the exemption from taxation
pursuant to Section 23701d.
  SEC. 3.  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. 4.  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.