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AB-37 Sales and use taxes: exemptions: gasoline and diesel fuel.(2001-2002)

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Amended  IN  Assembly  March 26, 2001
Amended  IN  Assembly  May 09, 2001

CALIFORNIA LEGISLATURE— 2001–2002 REGULAR SESSION

Assembly Bill
No. 37

Introduced  by  Assembly Member Strickland
 (Principal Coauthor(s): Assembly Member Mountjoy)
 (Coauthor(s): Assembly Member Aanestad, Ashburn, Bates, Bill Campbell, Cogdill, Cox, La Suer, Leach, Leonard, Maddox, Matthews, Robert Pacheco, Rod Pacheco, Pescetti, Richman, Runner, Wyman, Zettel)
 (Coauthor(s): Senator Ackerman, Battin, Haynes, Margett, McClintock, Monteith)

December 04, 2000

An act to add Section 6389 to the Revenue and Taxation Code,An act to amend Section 60115 of, to add Section 6389 to, and to repeal Section 60116 of, the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy .


LEGISLATIVE COUNSEL'S DIGEST


AB 37, as amended, Strickland. Sales and use taxes: exemptions: gasoline and diesel fuel.
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.
This bill would exempt motor vehicle fuel and diesel fuel from those taxes that tax.
Existing law also imposes a tax upon the use of diesel fuel in a motor vehicle in this state by interstate users, and specifies that the rate of that tax includes two components. Existing law includes as one of those components a percentage rate calculated on the basis of state and local sales and use tax rates.
This bill would eliminate this tax rate component.
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 provide that local agencies shall be reimbursed in the annual Budget Act for any sales and use tax revenues lost by them under this act.
This bill would take effect immediately as a tax levy.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: YES  

The people of the State of California do enact as follows:


SECTION 1.

 Section 6389 is added to the Revenue and Taxation Code, to read:

6389.
 There are exempted from the taxes imposed by this part, the gross receipts from the sale in this state of, and the storage, use, or other consumption in this state of, motor vehicle fuel, as defined by Section 7304 7326, and diesel fuel, as defined by Section 60022.

Section 60115 of the Revenue and Taxation Code is amended to read:

60115.
 For the privilege of using diesel fuel in a qualified motor vehicle in this state by interstate users, there is hereby imposed upon any interstate user for each gallon of diesel fuel used in this state, a tax consisting of the following two components:
(a)A tax at the rate imposed by Section 60050.

(b)A tax at the rate prescribed by Section 60116.

Section 60116 of the Revenue and Taxation Code is repealed.
60116.Commencing on January 1, 1998, and on each January 1 thereafter, the board shall establish a tax rate per gallon, rounded to the nearest tenth of a cent, by multiplying the average retail price per gallon (including the federal excise tax and excluding the state excise tax and the sales and use tax) of diesel fuel sold in this state by a percentage equal to the combined state and local sales tax rate established by Part 1 (commencing with Section 6001) and Part 1.5 (commencing with Section 7200) of Division 2 of the Revenue and Taxation Code and Section 35 of Article XIII of the California Constitution. The average retail price per gallon shall be the average of weekly retail prices for the 12-month period ending August 31 of the year prior to the effective date of the new rate. In determining the average retail price per gallon, the board shall use the weekly average retail price published by the State Energy Resources Conservation and Development Commission, in its publication “Fuel Price And Supply Update.” In the event the “Fuel Price And Supply Update” is delayed or discontinued, the board may base its determination on other sources of the average retail price of diesel fuel. The board shall make its determination of the rate no later than October 1 of the year prior to the effective date of the new rate.

SEC. 4.

 Local agencies shall be reimbursed in the annual Budget Act for any sales and use tax revenues lost by them pursuant to this act.
SEC. 3.

SEC. 5.

 This act provides for a tax levy within the meaning of Article IV of the Constitution and shall go into immediate effect.