BILL ANALYSIS                                                                                                                                                                                                    �




                     SENATE GOVERNANCE & FINANCE COMMITTEE
                            Senator Lois Wolk, Chair
          

          BILL NO:  AB 843                      HEARING:  6/27/12
          AUTHOR:  Calderon                     FISCAL:  Yes
          VERSION:  1/4/12                      TAX LEVY:  No
          CONSULTANT:  Grinnell                 

               NONMONETIZED BULLION AND NUMISMATIC COIN EXEMPTION
          

              Changes the date for BOE to calculate the inflation 
                        adjustment for a tax exemption.


                           Background and Existing Law  

          Currently, the sales of bulk monetized bullion, 
          nonmonetized gold or silver bullion, and numismatic coins 
          are exempt from the sales and use tax.  Monetized bullion 
          refers to coins used as currency, or certain gold 
          medallions authorized by federal law.   Nonmonetized 
          bullion refers to coins whose value lies in their metal 
          content -- e.g., Canadian Maple Leaf coins.   Numismatic 
          coins are those that are collectible because of rarity or 
          artistic value.

          BOE has indexed the $1,000 market value threshold for 
          "bulk" for inflation since 1993; sales below that price are 
          taxable (SB 213, Beverly).  BOE must complete the inflation 
          adjustment by September 1st each year, and based on the 
          change in the California Consumer Price Index.  After BOE 
          staff calculates the change in CPI, which is not usually 
          available until late August of each year, not leaving 
          sufficient time for BOE to approve the change by the 
          statutory deadline.  

                                   Proposed Law  

          Assembly Bill 843 changes the deadline from September 1st 
          to October 1st for BOE to perform the annual inflation 
          adjustment to determine the sales and use tax exemption 
          threshold bulk monetized bullion, nonmonetized gold or 
          silver bullion, and numismatic coins.

                               State Revenue Impact
           




          AB 843 - 1/4/12 -- Page 2



          BOE estimates no revenue impact.

                                     Comments  

          1.   Purpose of the bill  .  The purpose of the bill is to 
          allow BOE staff sufficient time to obtain data reflecting 
          the change in the California Consumer Price Index, prepare 
          the necessary calculation, and place the item on BOE's 
          agenda.  


                                 Assembly Actions  

          Assembly Revenue and Taxation Committee:  9-0
          Assembly Appropriations Committee:17-0
          Assembly Floor:                    75-0


                         Support and Opposition  (6/20/12)

           Support  :  State Board of Equalization.

           Opposition  :  Unknown.