BILL ANALYSIS                                                                                                                                                                                                    �



                                                                  AB 43
                                                                  Page  1

          Date of Hearing:   January 23, 2014

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                  Mike Gatto, Chair

                  AB 43 (Bocanegra) - As Amended:  January 6, 2014 

          Policy Committee:                              Revenue and  
          Taxation     Vote:                            9-0

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:              

           SUMMARY  

          This bill authorizes a retailer to make an irrevocable election  
          to assign to a customer the right to receive a sales and use tax  
          refund if specified conditions are met.

           FISCAL EFFECT  

          Minor and absorbable costs for the Board of Equalization (BOE).

           COMMENTS  

           1)Purpose  .  According to the author, this common sense measure  
            would, under limited circumstances, allow a retailer to assign  
            its right to receive a sales tax refund to a customer.  To  
            promote administrative efficiency, such direct refunds would  
            only be allowed where the refund amount is $50,000 or more and  
            is made to a single customer.  The author states issuing a  
            refund directly to a customer shortens the refund process by  
            approximately two to three months and eliminates processing by  
            the retailer.  The author contends this bill will enable  
            customers to receive refunds in a more expeditious fashion and  
            ease the workload of certain retailers who will no longer be  
            required to issue refund checks themselves.
              
           2)Support  .  Supporters, including the BOE and the California  
            retailers Association, state AB 43 would authorize a retailer  
            to irrevocably assign to a customer the right to receive a  
            refund of excess sales tax reimbursement which would allow the  
            BOE to directly refund the customer who paid the excess tax.   
            They argue AB 43 is a common sense measure, which helps to  
            alleviate an administrative burden in receiving the  








                                                                  AB 43
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            reimbursement of sales tax rightfully owed to the taxpayer.

           3)There is no registered opposition to this bill.  
                 
              
           
           Analysis Prepared by  :    Roger Dunstan / APPR. / (916) 319-2081