BILL NUMBER: AB 81 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY FEBRUARY 16, 2011
INTRODUCED BY Assembly Member Beall
JANUARY 4, 2011
An act to amend Section 7392 of the Revenue and Taxation
Code, relating to taxation, to take effect immediately, tax levy.
An act to add and repeal Section 6357.8 of the Revenue
and Taxation Code, relating to taxation, to take effect
immediately, tax levy.
LEGISLATIVE COUNSEL'S DIGEST
AB 81, as amended, Beall. Fuel taxes: aircraft jet fuel
dealers: rate. Sales and use taxes: exemptions: fuel
and petroleum products: air common carriers.
The Sales and Use Tax Law imposes 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. That
law provides various exemptions from that tax, including an exemption
for the gross receipts from the sale of, and the storage, use, or
other consumption of, fuel and petroleum products sold to an air
common carrier for immediate consumption or shipment in the conduct
of its business on an international flight.
This bill would, on or after January 1, 2012, and before January
1, 2020, exempt from those state taxes, gross receipts in excess of
$2.22 per gallon derived from the sale in this state of, and the
storage, use, or other consumption in this state of, fuel and
petroleum products sold to or purchased by an air common carrier for
consumption or shipment in the conduct of its business on a domestic
flight, as specified.
This bill would also require the State Board of Equalization,
beginning on January 1, 2013, and annually thereafter, to submit a
report to the Legislature setting forth the state fiscal impact of
the exemption.
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, which conforms to
the Sales and Use Tax Law. Exemptions from state sales and use taxes
are incorporated into these laws.
This bill would specify that this exemption does not apply to
local sales and use taxes or transactions and use taxes, unless the
governing body of the taxing county, city, or district authorizes an
exemption and provides notice to the board on or before December 1,
2011.
This bill would take effect immediately as a tax levy.
Existing law imposes a tax for the privilege of using or selling
aircraft jet fuel upon each aircraft jet fuel dealer at a rate of
$0.02 for each gallon of that fuel sold to an aircraft jet fuel user
or used by the dealer as an aircraft jet fuel user.
This bill would reduce the rate of the jet fuel tax to $0.01 for
each gallon of fuel sold.
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:
SECTION 1. Section 6357.8 is added to the
Revenue and Taxation Code , to read:
6357.8. (a) On and after January 1, 2012, and before December 31,
2019, there are exempted from the taxes imposed by this part, gross
receipts in excess of two dollars and twenty-two cents ($2.22) per
gallon derived from the sale in this state of, or the storage, use,
or other consumption in this state of, fuel and petroleum products
sold to or purchased by an air common carrier for consumption or
shipment in the conduct of its business as an air common carrier, on
a domestic flight.
(b) To qualify for the exemption, the air common carrier shall
furnish to the seller an exemption certificate in the form prescribed
by the board. Acceptance in good faith of that certificate shall
relieve the seller from liability for that portion of the sales tax
exempted under this section.
(c) For purposes of this section, the following definitions apply:
(1) "Air common carrier" has the same meaning as that set forth in
Section 23046 of the Business and Professions Code.
(2) "Domestic flight" means a flight whose final destination is a
point inside of the United States, including its territories.
(d) Any air common carrier claiming exemption under this section
that is not required to hold a valid seller's permit, shall be
required to register with the board and obtain a fuel exemption
registration number, and shall be required to file returns as the
board may prescribe, either if the board notifies the carrier that
returns must be filed or if the carrier is liable for taxes based
upon consumption or transportation of fuel or petroleum products
erroneously claimed as exempt under this section.
(e) An air common carrier claiming an exemption under this section
upon request, shall make available to the board records, including,
but not limited to, a copy of a log abstract, an air waybill, or a
cargo manifest, documenting its consumption or transportation of the
fuel or petroleum products on a domestic flight and the amount
claimed as exempt. If the carrier fails to provide these records upon
request, the board may revoke the carrier's fuel exemption
registration number.
(f) The board may require any air common carrier claiming an
exemption under this section and required to obtain a fuel exemption
registration number, to place with it such security as the board may
determine pursuant to Section 6701.
(g) Pursuant to this section, any use of the fuel and petroleum
products by the purchasing carrier, other than that incident to the
delivery of the fuel and petroleum products to the carrier and the
consumption or transportation of the fuel and petroleum products by
the carrier on a domestic flight for use in the conduct of its
business as a common carrier, or a failure of the carrier to document
its consumption or transportation of the fuel and petroleum products
on a domestic flight, shall subject the carrier to liability for
payment of sales tax as if it were a retailer making a retail sale of
the property at the time of that use or failure, and the sales price
of the property to it shall be deemed to be the gross receipts from
the retail sale.
(h) (1) Notwithstanding any provision of the Bradley-Burns Uniform
Local Sales and Use Tax Law (Part 1.5 (commencing with Section
7200)) or the Transactions and Use Tax Law (Part 1.6 (commencing with
Section 7251)), the exemption established by this section shall not
apply with respect to any tax levied by a county, city, or district
pursuant to, or in accordance with, either of those laws, unless
approved by the local government that would otherwise receive the
revenues derived from the taxes imposed under those laws.
(2) The governing body of any county, city, or district may enact
an ordinance to authorize the exemption as described in subdivision
(a) with respect to taxes levied by that entity, and shall notify the
State Board of Equalization of this action on or before December 1,
2011.
(i) (1) On January 1, 2013, and annually thereafter, the State
Board of Equalization shall submit a report to the Legislature
setting forth the state fiscal impact of the exemption allowed under
this section.
(2) A report to be submitted pursuant to paragraph (1) shall be
submitted in compliance with Section 9795 of the Government Code.
(j) This section shall remain in effect only until January 1,
2020, and as of that date is repealed.
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.
SECTION 1. Section 7392 of the Revenue and
Taxation Code is amended to read:
7392. For the privilege of using or selling aircraft jet fuel a
tax is imposed upon every aircraft jet fuel dealer at the rate of one
cent ($0.01) for each gallon of that fuel sold to an aircraft jet
fuel user or used by the dealer as an aircraft jet fuel user.
SEC. 2. This act provides for a tax levy within
the meaning of Article IV of the Constitution and shall go into
immediate effect.