BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 2758|
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CONSENT
Bill No: AB 2758
Author: Assembly Revenue and Taxation Committee
Amended: 4/10/14 in Assembly
Vote: 21
SENATE GOVERNANCE & FINANCE COMMITTEE : 6-0, 6/25/14
AYES: Wolk, Knight, Beall, DeSaulnier, Hernandez, Walters
NO VOTE RECORDED: Liu
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 73-0, 5/23/14 (Consent) - See last page for
vote
SUBJECT : Sales and use taxes: administration: qualified
use tax: acceptable tax return
SOURCE : Author
DIGEST : This bill provides that an amount equal to the
qualified use tax a taxpayer reports on an acceptable tax return
filed with the Franchise Tax Board (FTB) shall be applied to
that taxpayer's use tax liability.
ANALYSIS : Existing law imposes a sales tax on retailers for
the privilege of selling tangible personal property (TPP),
absent a specific exemption. The tax is based upon the
retailer's gross receipts from TPP sales in this state.
Existing law imposes, on transactions not subject to sales tax,
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a complementary use tax on the storage, use, or other
consumption in this state of TPP purchased from any retailer.
The use tax is imposed on the purchaser, and unless the
purchaser pays the use tax to a retailer registered to collect
California's use tax, the purchaser remains liable for the tax,
unless the use is exempted. The use tax is set at the same rate
as the state's sales tax and must generally be remitted to the
State Board of Equalization (BOE).
Existing law authorizes a person to make an irrevocable election
to report qualified use tax, as defined, on that person's income
tax return and provides that any payments and credits shown on
the return of a person reporting qualified use tax shall be
applied in the following order:
Taxes imposed under the Personal Income Tax Law or the
Corporation Tax Law, including penalties and interest, if any;
and
Qualified use tax reported.
This bill first applies the amount of payments or credits
available on the tax return to the use tax liability reported on
the tax return, and then to outstanding taxes, penalties, or
interest.
This bill becomes effective January 1, 2015, and applies to
taxable years beginning on or after January 1, 2014.
Comments
Since 1933, the state has imposed a sales tax on California
retailers for the privilege of selling TPP, absent a specific
exemption. The tax is based upon the retailer's gross receipts
from TPP sales in this state. In 1935, California adopted a
complementary "use tax" on the storage, use, or other
consumption of TPP purchased out-of-state and brought into
California. The use tax was designed to protect California
merchants who would otherwise be at a competitive disadvantage
when out-of-state retailers sell to California customers without
charging tax.
Unlike the sales tax, the use tax is imposed on the purchaser
and not the retailer. Unless the purchaser pays the use tax to
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an out-of-state retailer registered to collect California's use
tax, the purchaser remains liable for the tax. The use tax is
set at the same rate as the state's sales tax and must generally
be remitted to the BOE.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
ASSEMBLY FLOOR : 73-0, 5/23/14
AYES: Achadjian, Alejo, Allen, Ammiano, Bigelow, Bloom,
Bocanegra, Bonta, Bradford, Brown, Buchanan, Ian Calderon,
Campos, Chau, Ch�vez, Chesbro, Conway, Cooley, Dababneh,
Dahle, Daly, Dickinson, Donnelly, Eggman, Fong, Fox, Frazier,
Beth Gaines, Garcia, Gatto, Gomez, Gonzalez, Gordon, Gorell,
Gray, Grove, Hagman, Hall, Holden, Jones, Jones-Sawyer,
Levine, Linder, Logue, Lowenthal, Maienschein, Mansoor,
Medina, Mullin, Muratsuchi, Nazarian, Olsen, Pan, Patterson,
Perea, John A. P�rez, Quirk, Quirk-Silva, Rendon,
Ridley-Thomas, Rodriguez, Salas, Skinner, Stone, Ting, Wagner,
Waldron, Weber, Wieckowski, Wilk, Williams, Yamada, Atkins
NO VOTE RECORDED: Bonilla, Harkey, Roger Hern�ndez, Melendez,
Nestande, V. Manuel P�rez, Vacancy
AB:k 8/5/14 Senate Floor Analyses
SUPPORT/OPPOSITION: NONE RECEIVED
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