The Sales and Use Tax Law imposes a tax on the gross receipts from the sale in this state of, or the storage, use, or other consumption in this state of, tangible personal property. That law provides various exemptions from that tax. Existing law authorizes cities, counties, and cities and counties to impose local sales or transactions and use taxes, and provides that exemptions from state sales and use tax are incorporated into those local taxes.
This bill would establish an additional exemption from sales and use taxes with respect to the sale in this state of, or the storage, use, or other consumption in this state of, college textbooks, as defined. The exemption would be available only if students present proof that they are enrolled in an institution of higher education, as defined, and enrolled in the course for which the textbooks are required.
Counties and cities are authorized to impose local sales and use taxes in conformity with state sales and use taxes. Exemptions from state sales and use taxes enacted by the Legislature are incorporated into the local taxes.
Section 2230 of the Revenue and Taxation Code provides that the state will reimburse counties and cities for revenue losses caused by the enactment of sales and use tax exemptions.
This bill would make an appropriation from the General Fund, without regard to fiscal years, to reimburse local governments for sales and transactions and use tax revenue losses incurred as a result of the exemption created by the bill.
This bill would take effect immediately as a tax levy, but its operative date would depend on its effective date.