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AB-607 Sales and use taxes: exemptions: blood screening testing.(2021-2022)

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Date Published: 01/03/2022 02:00 PM
AB607:v98#DOCUMENT

Amended  IN  Assembly  January 03, 2022

CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Assembly Bill
No. 607

Introduced by Assembly Members Arambula and Patterson

February 12, 2021

An act to add and repeal Section 6364.7 of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.


LEGISLATIVE COUNSEL'S DIGEST


AB 607, as amended, Arambula. Sales and use taxes: exemptions: blood screening testing.
Existing state sales and use tax laws impose a tax on retailers measured by the gross receipts from the sale of tangible personal property sold at retail in this state or on the storage, use, or other consumption in this state of tangible personal property purchased from a retailer for storage, use, or other consumption in this state. The Sales and Use Tax Law provides various exemptions from those taxes, including an exemption for the sale of, or the storage, use, or consumption of, any container used to collect or store human whole blood, plasma, blood products, or blood derivatives.
This bill, on and after January 1, 2022, 2023, and before January 1, 2027, 2028, would exempt the gross receipts from the sale in this state of, and the storage, use, or other consumption in this state of, any reagents or chemicals, and lab equipment and supplies, used by a licensed nonhospital blood bank to perform blood screening tests on donated human blood.
Existing law requires a bill that would authorize a new tax expenditure under the Sales and Use Tax Law to identify specific goals, purposes, and objectives that the tax expenditure will achieve, and detailed performance indicators and data collection requirements for determining whether the tax expenditure achieves these goals, purposes, and objectives.
This bill would include additional information required for any bill authorizing a new tax expenditure.
The Bradley-Burns Uniform Local Sales and Use Tax Law authorizes counties and cities to impose local sales and use taxes in conformity with the Sales and Use Tax Law, and existing laws authorize districts, as specified, to impose transactions and use taxes in accordance with the Transactions and Use Tax Law, which generally conforms to the Sales and Use Tax Law. Amendments to the Sales and Use Tax Law are automatically incorporated into the local tax laws.
Existing law requires the state to reimburse counties and cities for revenue losses caused by the enactment of sales and use tax exemptions.
This bill would provide that, notwithstanding Section 2230 of the Revenue and Taxation Code, no appropriation is made and the state shall not reimburse any local agencies for sales and use tax revenues lost by them pursuant to this bill.
This bill would take effect immediately as a tax levy.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

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


SECTION 1.

 Section 6364.7 is added to the Revenue and Taxation Code, to read:

6364.7.
 (a) On and after January 1, 2022, 2023, and before January 1, 2027, 2028, 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, both of the following:
(1) Reagents or chemicals used by a licensed nonhospital blood bank to perform blood screening tests on donated human blood.
(2) Lab equipment and supplies used by a licensed nonhospital blood bank to perform blood screening tests on donated human blood.
(b) For purposes of this section:
(1) “Blood screening tests” means screening tests mandated by the FDA or the State of California to assure ensure the safety of voluntary blood, platelets, and plasma donations, including, but not limited to, tests for basic red blood cell-type antigens (ABO), basic red blood cell antigens (Rh), antibodies, syphilis, hepatitis B and C, human immunodeficiency virus (HIV), human T-cell leukemia virus (HTLV), Chagas disease, West Nile virus, Zika virus, and any future-required donor screening test by whatever is the currently required methodology.
(2) “Donated human blood” means human blood that is given to an FDA-licensed or registered FDA-registered blood facility, by a medically eligible individual, after being properly consented.
(3) “FDA” means the United States Food and Drug Administration.
(4) “Lab equipment and supplies” mean any FDA-approved instruments, devices, and related data processing devices that are specifically required in order to perform blood screening tests.
(5) “Licensed nonhospital blood bank” means any FDA-licensed or FDA-registered facility that is not a hospital and recruits, collects, processes, and distributes human blood for transfusion purposes.
(6) “Reagents or chemicals” means only those reagents, quality control materials, assay kits, diluents, and calibrators that are specifically required in order to perform blood screening tests.
(c)  This section shall remain in effect only until December 31, 2027, 2028, and as of that date is repealed.

SEC. 2.

 For purposes of complying with Section 41 of the Revenue and Taxation Code, with respect to the tax expenditure created by the addition of Section 6364.7 to the Revenue and Taxation Code made by this act, the Legislature finds and declares all of the following:
(a) The specific goals, purposes, and objectives that this act will achieve are:
(1) To provide a tax incentive for blood banks to test their own blood donations and to motivate testing facilities to locate in California.
(2) To ensure that, in the event of a disaster or homeland security event, California is able to test blood donations without transferring many of those blood samples out of state for testing.
(b) Detailed performance indicators for the Legislature to use in determining whether this act meets the goals, purposes, and objectives listed in subdivision (a) are:
(1) The number of blood banks who initiate testing of blood donations in their own facilities.
(2) Whether any new facilities are established in California to test blood donations.
(c) The Central California Blood Center and the Stanford Blood Center shall annually provide to the California Department of Tax and Fee Administration the information described in subdivision (b) and shall report the information to the Legislature in any year in which Section 6364.7 of the Revenue and Taxation Code is operative.

SEC. 3.

  Notwithstanding Section 2230 of the Revenue and Taxation Code, no appropriation is made by this act and the state shall not reimburse any local agency for any sales and use tax revenues lost by it under this act.

SEC. 4.

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