Today's Law As Amended


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AB-657 Child Welfare Funding Act.(2023-2024)



As Amends the Law Today


SECTION 1.

 Section 6359 of the Revenue and Taxation Code is amended to read:

6359.
 (a) There are exempted from the taxes imposed by this part the gross receipts from the sale of, and the storage, use, or other consumption in this state of, food products for human consumption.
(b) For the purposes of this section, “food products” includes all of the following:
(1) Cereals and cereal products, oleomargarine, meat and meat products, fish and fish products, eggs and egg products, vegetables and vegetable products, fruit and fruit products, spices and salt, sugar and sugar products, candy,  gum, confectionery, coffee and coffee substitutes, tea, and cocoa and cocoa products.
(2) Milk and milk products, milkshakes, malted milks, and any other similar type beverages that are composed at least in part of milk or a milk product and that require the use of milk or a milk product in their preparation.
(3) All fruit juices, vegetable juices, and other beverages, whether liquid or frozen, including bottled water, but excluding spirituous, malt, or vinous liquors or carbonated beverages.
(c) For purposes of this section, “food products” does not include any of the following:
(1) Medicines, including medicinal cannabis or medicinal cannabis products, as defined in Division 10 (commencing with Section 26000) of the Business and Professions Code, and preparations in liquid, powdered, granular, tablet, capsule, lozenge, and pill form sold as dietary supplements or adjuncts.
(2) Cannabis, as defined in Section 11018 of the Health and Safety Code, and cannabis products, as defined in Section 11018.1 of the Health and Safety Code.
(3) This addition of this subdivision does not constitute a change in, but is declaratory of, existing law.
(d) None of the exemptions in this section apply to any of the following:
(1) When the food products are served as meals on or off the premises of the retailer.
(2) When the food products are furnished, prepared, or served for consumption at tables, chairs, or counters or from trays, glasses, dishes, or other tableware whether provided by the retailer or by a person with whom the retailer contracts to furnish, prepare, or serve food products to others.
(3) When the food products are ordinarily sold for immediate consumption on or near a location at which parking facilities are provided primarily for the use of patrons in consuming the products purchased at the location, even though those products are sold on a “take out” or “to go” order and are actually packaged or wrapped and taken from the premises of the retailer.
(4) When the food products are sold for consumption within a place, the entrance to which is subject to an admission charge, except for national and state parks and monuments, marinas, campgrounds, and recreational vehicle parks.
(5) When the food products are sold through a vending machine.
(6) When the food products sold are furnished in a form suitable for consumption on the seller’s premises, and both of the following apply:
(A) Over 80 percent of the seller’s gross receipts are from the sale of food products.
(B) Over 80 percent of the seller’s retail sales of food products are sales subject to tax pursuant to paragraph (1), (2), (3), or (7).
(7) When the food products are sold as hot prepared food products.
(e) “Hot prepared food products,” for the purposes of paragraph (7) of subdivision (d), include a combination of hot and cold food items or components where a single price has been established for the combination and the food products are sold in combination, such as a hot meal, a hot specialty dish or serving, a hot sandwich, or a hot pizza, including any cold components or side items. Paragraph (7) of subdivision (d) does not apply to a sale for a separate price of bakery goods or beverages (other than bouillon, consommé, or soup), or where the food product is purchased cold or frozen; “hot prepared food products” means those products, items, or components that have been prepared for sale in a heated condition and that are sold at any temperature that is higher than the air temperature of the room or place where they are sold.
(f) Notwithstanding paragraph (6) of subdivision (d), if the seller elects to separately account for sales of food products specified in subdivision (b), then the gross receipts from the sale of those food products shall be exempt under subdivision (a), provided that the separate accounting is fully documented in the seller’s records. However, if the seller’s records do not reflect the separate accounting of the gross receipts from sales of nontaxable food products, the seller’s election under this subdivision shall be revoked.

SEC. 2.

 Part 13.8 (commencing with Section 31210) is added to Division 2 of the Revenue and Taxation Code, to read:

PART 13.8. Child Welfare Funding Act

CHAPTER  1. General Provisions
31210.
 This part shall be known as the Child Welfare Funding Act.
31211.
 For purposes of this part:
(a) “Adjusted total gross receipts” means an adjusted total gross receipt amount determined pursuant to subparagraph (B) of paragraph (2) of subdivision (b) of Section 31213.
(b) “Candy” means a preparation of sugar, honey, or other natural or artificial sweeteners in combination with chocolate, fruits, nuts, or other ingredients or flavorings in the form of bars, drops, or pieces.
(c) “Department” means the California Department of Tax and Fee Administration.
(d) “Fund” means the Candy Tax Fund created pursuant to Section 31220.
CHAPTER  2. Sales Tax Returns for Gross Receipts From the Sale of Candy
31213.
 (a) A return filed with the department to report gross receipts for sales tax purposes shall segregate the taxable sales attributable to the sale of candy on a line or a separate form, as prescribed by the department.
(b) (1) The department shall report the amount of the total gross receipts segregated on the returns filed for the prior fiscal year pursuant to subdivision (a) to the Department of Finance on or before November 1 of each year.
(2) (A) The total gross receipts reported pursuant to paragraph (1) shall be subject to review, which may be a review of a sample of returns, by the department for errors.
(B) The department shall note any errors identified in the review and the approximate impact of those errors on the total gross receipts in the report to the Department of Finance required by this subdivision to allow an adjusted total gross receipt amount to be determined.
(c) An amount equal to the total amount of gross receipts, or adjusted gross receipts, for the prior fiscal year reported to the Department of Finance by the department pursuant to subdivision (b) shall be deposited into the fund as soon as reasonably possible.
CHAPTER  3. Candy Tax Fund
31220.
 (a) There is hereby created in the State Treasury the Candy Tax Fund.
(b) All moneys in the fund shall be distributed to the Child Welfare Grant Program Fund created by Section 13951 of the Welfare and Institutions Code.
CHAPTER  4. Administration
31225.
 (a) The department may prescribe, adopt, and enforce regulations relating to the administration and enforcement of this part.
(b) (1) The department may prescribe, adopt, and enforce emergency regulations as necessary to implement this part.
(2) An emergency regulation prescribed, adopted, or enforced pursuant to this paragraph shall be adopted in accordance with Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, and, for purposes of that chapter, including Section 11349.6 of the Government Code, the adoption of the regulation is an emergency and shall be considered by the Office of Administrative Law as necessary for the immediate preservation of the public peace, health and safety, and general welfare.

SEC. 3.

 Chapter 6.6 (commencing with Section 13950) is added to Part 3 of Division 9 of the Welfare and Institutions Code, to read:

CHAPTER  6.6. Child Welfare Grant Program
13950.
 As used in this chapter:
(a) “Fund” means the Child Welfare Grant Program Fund created pursuant to Section 13951.
(b) “Qualified recipient” means an individual who is a resident of the state and meets either of the following criteria:
(1) The individual filed a joint income tax return for the preceding taxable year that reported gross income in an amount not exceeding one hundred fifty thousand dollars ($150,000).
(2) The individual filed an individual income tax return for the preceding taxable year that reported gross income in an amount not exceeding one hundred twelve thousand dollars ($112,000).
13951.
 (a) (1) There is hereby created in the State Treasury the Child Welfare Grant Program Fund under the administration of the department.
(2) Notwithstanding Section 13340 of the Government Code, the moneys in the fund shall be continuously appropriated to the department for the purpose of providing grants pursuant to subdivision (c).
(b) There is hereby created, under the administration of the department, the Child Welfare Grant Program.
(c) The department shall annually, on or before December 31, distribute to any qualified recipient a Child Welfare Grant Program grant in an amount determined pursuant to both of the following:
(1) For each dependent minor of the qualified recipient under six years of age, the amount of the grant shall be three thousand dollars ($3,000).
(2) For each dependent minor of the qualified recipient between 6 and 17 years of age, the amount of the grant shall be two thousand five hundred dollars ($2,500).
13952.
 (a) The department may adopt regulations necessary for the purposes of this chapter.
(b) Notwithstanding Section 19542 of the Revenue and Taxation Code, the Franchise Tax Board may, upon request of the department, share with the department taxpayer information necessary to perform the department’s duties under this chapter.
13953.
 This chapter shall remain in effect only until January 1, 2029, and as of that date is repealed.
SEC. 4.
 (a) Section 1 of this act amends Proposition 163, an initiative measure approved by the voters at the November 3, 1992, general election, and shall become effective only when this act is submitted to and approved by the voters. The Secretary of State shall submit Section 1 of this act to the voters at a statewide election in accordance with Section 9040 of the Elections Code.
(b) Sections 2 and 3 of this act shall become operative only if Section 1 of this act is approved by the voters and takes effect.
SEC. 5.
 Sections 1 to 3, inclusive, of this act shall become operative only if Assembly Constitutional Amendment __ of the 2023–24 Regular Session is approved by the voters and takes effect.