BILL ANALYSIS                                                                                                                                                                                                    �




                     SENATE GOVERNANCE & FINANCE COMMITTEE
                            Senator Lois Wolk, Chair
          

          BILL NO:  AB 2270                     HEARING:  6/27/12
          AUTHOR:  Harkey                       FISCAL:  Yes
          VERSION:  4/17/12                     TAX LEVY:  No
          CONSULTANT:  Miller                   

                    SALES AND USE TAX: USE TAX ADMINSTRATION
          

          Sets April 15th as the due date for "eligible purchasers" 
          whose purchases were taxable the preceding calendar year.


                           Background and Existing Law  

          Current existing law imposes a sales tax and complementary 
          use tax on retailers for the privilege of selling tangible 
          personal property based upon the retailer's gross receipts 
          in this state, unless specifically exempted.  The use tax 
          is imposed on the purchaser for the storage, use, or other 
          consumption in this state of goods purchased from any 
          retailer.  The standard statewide sales and use tax is 
          7.25%.  Cities, counties and special districts may impose 
          an additional transactions and use tax (sales tax) with 
          voter approval as well.

          Current law allows taxpayers to pay their use tax liability 
          either directly to the BOE by January 31st or on their 
          income tax returns by April 15th.  


                                   Proposed Law  

          Assembly Bill 2270 provides that the "qualified use tax" as 
          defined by current law of an "eligible purchaser" defined 
          as a purchaser of goods subject to the use tax shall be due 
          and payable to BOE on or before April 15th following the 
          close of the calendar year in which the use tax liability 
          was incurred.  The eligible purchaser also is not required 
          registered with the BOE.  The bill specifies that 
          "qualified use tax" does not include the use tax imposed on 
          specified mobile homes, vehicles, and leases.


                               State Revenue Impact




          AB 2270 -- 4/17/12 -- Page 2


           
          According to the BOE, this bill would have negligible 
          impacts on state and local revenue.





                                     Comments  

          1.   Purpose of the bill  .  This bill is sponsored by the BOE 
          to make tax payment deadlines more consistent.  Under 
          current law, a taxpayer may file his or her use tax on the 
          income tax return by April 15th but must file his or her 
          use tax payment directly with the BOE by January 31st.  If 
          the taxpayer pays the tax directly to the BOE on April 
          15th, he or she would be considered late and the individual 
          would be subjected to the late payment penalty and 
          interest.  This bill makes the dates consistent and less 
          confusing for the taxpayer.


                                 Assembly Actions  

          Assembly Revenue and Taxation:       8-0
          Assembly Appropriations:            16-0
          Assembly Floor:                     72-0


                         Support and Opposition  (6/21/12)

           Support  :  Board of Equalization (sponsor); Senator George 
          Runner (Ret.), BOE Member.

           Opposition :  Unknown.