Bill Text: CA AB1077 | 2013-2014 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Sales and use taxes: vehicle license fee: alternative fuel motor vehicles.

Spectrum: Partisan Bill (Democrat 4-0)

Status: (Introduced - Dead) 2014-02-03 - From committee: Filed with the Chief Clerk pursuant to Joint Rule 56. [AB1077 Detail]

Download: California-2013-AB1077-Amended.html

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BILL NUMBER: AB 1077	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  APRIL 2, 2013

INTRODUCED BY   Assembly Member Muratsuchi
    (   Coauthors:   Assembly Members 
 Stone   and Williams   ) 

                        FEBRUARY 22, 2013

   An act to add and repeal Sections 6011.3, 6012.4, and 10759.5 of
the Revenue and Taxation Code, relating to taxation, to take effect
immediately, tax levy.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 1077, as amended, Muratsuchi. Sales and use taxes: vehicle
license fee: exclusion: alternative fuel motor vehicles.
   Existing laws impose state sales and use taxes 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  , measured by the sales price  . The Sales and
Use Tax Law defines the terms "gross receipts" and "sales price."
   This bill would, on and after January 1, 2014, and before January
1, 2022, exclude from the terms "gross receipts" and "sales price
 ,  "  the amount of the incremental cost, as
defined, included in the sales price   in the sale 
of a new alternative fuel motor vehicle  , any amount allowed as
a credit under a specified provision of the Internal Revenue Code,
relating to new qualified plug-in electric drive motor vehicles, and
  any amounts received, awarded, or allowed pursuant to a
state incentive program for the purchase or lease of an alternative
fuel vehicle  .
   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 law authorizes
districts, as specified, to impose transactions and use taxes in
accordance with the Transactions and Use Tax Law, which conforms to
the Sales and Use Tax Law. Exemptions from state sales and use taxes
are incorporated into these laws.
   This bill would specify that this exclusion does not apply to
local sales and use taxes and transactions and use taxes.
   The Vehicle License Fee Law provides that the annual amount of the
license fee for any vehicle is 0.65% of the market value of the
vehicle, as specified. That law provides for the determination of the
market value of any vehicle, for reclassification to increase the
market value of a vehicle, and for the exemption of certain vehicles
from the imposition of the license fee.
   This bill would, on and after January 1, 2014, and before January
1, 2022, for purposes of determining the vehicle license fee,
 exempts   exempt  from the determination
of market value  the incremental costs, as defined, that are
incurred in the purchase  of a new motor vehicle propelled
by alternative  fuel   fuels any amount allowed
as a credit under a specified provision of the Internal Revenue Code,
relating to new qualified plug-in electric drive motor vehicles, and
any amounts r   eceived, awarded, or allowed pursuant to a
state incentive program for the purchase or lease of an alternative
fuel vehicle  .
   This bill would take effect immediately as a tax levy.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Legislature finds and declares:
   (a) There is a wide disparity in fees levied on owners of light-,
medium-, and heavy-duty vehicles operated on alternative fuels when
compared to those same taxes and fees levied on owners of comparable
gasoline and diesel fuel vehicles.
   (b) In some cases, the fees on alternative fuel vehicles are more
than twice as much as those for conventional fuel vehicles.
   (c) The disparity in fees exists even though the alternative fuel
vehicle may look identical to the conventional fuel vehicle and
provide the same or lesser utility to the individual owner.
   (d) The existing California vehicle license fee on motor vehicles
that operate on alternative fuels is higher than for comparable
conventional fuel vehicles because alternative fuel vehicles
generally have higher sales prices. The higher sales prices are
largely due to the fact that these vehicles are produced in extremely
low volumes (many assembled by hand), such that their production has
not achieved the economies of scale that would significantly reduce
their cost; and they use many new advanced materials and technologies
that also have not yet achieved economies of scale, and therefore
have a temporarily greater cost to consumers.
   (e) The higher sales prices for these alternative fuel vehicles
are expected to be a short-term, temporary situation because prices
are expected to decline significantly to competitive levels as volume
increases. If this does not occur, these vehicles may never be
competitive, and automakers would likely withdraw them from the
market. The current vehicle license fee does not reflect these
temporary, short-term pricing situations. Instead it intrinsically,
but incorrectly, assumes that these short-term higher prices reflect
true long-term market value of the vehicles.
   (f) Alternative fuel vehicles provide benefits to California
citizens that are external to, or not reflected in, their cost to the
purchaser. These benefits include: increasing our national
independence from foreign energy sources; providing more
transportation choices for consumers and businesses, thus reducing
our economic vulnerability to sudden fuel price increases caused by
external or internal events; reducing air pollutants, climate change
pollutants, and toxic emissions from mobile sources;  and 
reducing future pressures for additional environmental controls on
existing and new businesses and industries in California ;
and creating new advanced transportation technology jobs and
industries in California  .
   (g) It is the public policy of the State of California, the
federal government, and many local governments, to encourage the
development and use of alternative fuel vehicles, for the purpose of
providing the benefits described above to all California citizens.
   (h) Existing vehicle license fee calculations, as they relate to
the determination of market value of alternative fuel vehicles, do
not reflect the critical short-term pricing issues described above,
nor the external benefits that accrue to all California citizens.
Additionally, these existing fees act as a significant disincentive
to potential purchasers of alternative fuel vehicles, and as such,
are contrary to existing public policies at all levels of government.

   (i) It is the intent of the Legislature to equalize the vehicle
license fee between alternative fuel vehicles and conventional fuel
vehicles for a period of eight years, beginning January 1, 2014, and
ending December 31, 2021.  During this time period it is the
intent of the Legislature that the incremental or differential cost
between an alternative fuel vehicle and a comparable conventional
fuel vehicle, as determined by the State Energy Resources
Conservation and Development Commission, should be exempt from the
vehicle license fee. 
  SEC. 2.  Section 6011.3 is added to the Revenue and Taxation Code,
to read:
   6011.3.  (a) Notwithstanding Section 6011 or any other law, on and
after January 1, 2014, and before January 1, 2022, "sales price"
from the  sale   purchase of a new
alternative fuel motor vehicle shall not include  the amount
of the incremental cost   any amount allowed as a credit
under Section 30D of the Internal Revenue Code, relating to new
qualified plug-in electric drive motor vehicles, and any amounts
received, awarded, or allowed pursuant to a   state
incentive program for the purchase or lease of an alternative fuel
vehicle, including, but not limited to, state income tax credits, the
Clean Vehicle Rebate Project, the California Hybrid and
Zero-Emission Truck and Bus Voucher Incentive Project, and the
On-Road Heavy-Duty Voucher Incentive Program under the Carl Moyer
Program  .
   (b) For purposes of this section, all of the following shall
apply:
   (1) "Alternative fuel vehicle" means a motor vehicle subject to
registration under the Vehicle Code that operates some or all of the
time on a fuel other than gasoline or diesel. 
   (2) "Incremental cost" means the amount equal to the reasonable
difference between the cost of the new alternative fuel motor vehicle
and the cost of a comparable gasoline or diesel fuel vehicle. This
amount shall constitute the maximum incremental cost for purposes of
the exclusion in subdivision (a), and shall be reduced, as
appropriate, in accordance with the actual sales price of the
vehicle.  
   (3) 
    (2)  "Motor vehicle" means "motor vehicle" as defined by
Section 415 of the Vehicle Code.
   (c) The  actual incremental  cost  of the
vehicle after deducting the amounts   described in
subdivision (a)  shall be stated in the contract for sale or
lease with the purchaser, and shall be reported to the board
quarterly.
   (d) Notwithstanding any provision of the Bradley-Burns Uniform
Local Sales and Use Tax Law (Part 1.5 (commencing with Section 7200))
or the Transactions and Use Tax Law (Part 1.6 (commencing with
Section 7251)), the exclusion established by this section shall not
apply with respect to any tax levied by a county, city, or district
pursuant to, or in accordance with, either of those laws.
   (e) This section shall be repealed on January 1, 2022.
  SEC. 3.  Section 6012.4 is added to the Revenue and Taxation Code,
to read:
   6012.4.  (a) Notwithstanding Section 6012 or any other law, on and
after January 1, 2014, and before January 1, 2022, "gross receipts"
from the sale of a new alternative fuel motor vehicle shall not
include  the amount of the incremental cost  
any amount allowed as a credit under Section 30D of the Internal
Revenue Code, relating to new qualified plug-in electric drive motor
vehicles, and any amounts received, awarded, or allowed pursuant to a
state incentive program for the purchase or lease of an alternative
fuel vehicle, including, but not limited to, state income tax
credits, the Clean Vehicle Rebate Project, the California Hybrid
  and Zero-Emission Truck and Bus Voucher Incentive Project,
and the On-Road Heavy-Duty Voucher Incentive Program under the Carl
Moyer Program  .
   (b) For purposes of this section, all of the following shall
apply:
   (1) "Alternative fuel vehicle" means a motor vehicle subject to
registration under the Vehicle Code that operates some or all of the
time on a fuel other than gasoline or diesel. 
   (2) "Incremental cost" means the amount equal to as the reasonable
difference between the cost of the new alternative fuel motor
vehicle and the cost of a comparable gasoline or diesel fuel vehicle.
This amount shall constitute the maximum incremental cost for
purposes of the exclusion in subdivision (a), and shall be reduced,
as appropriate, in accordance with the actual sales price of the
vehicle.  
   (3) 
    (2)  "Motor vehicle" means "motor vehicle" as defined by
Section 415 of the Vehicle Code.
   (c) The  actual incremental  cost  of the
vehicle after deducting the amounts described in subdivision (a)
 shall be stated in the contract for sale or lease with the
purchaser, and shall be reported to the board quarterly.
   (d) Notwithstanding any provision of the Bradley-Burns Uniform
Local Sales and Use Tax Law (Part 1.5 (commencing with Section 7200))
or the Transactions and Use Tax Law (Part 1.6 (commencing with
Section 7251)), the exclusion established by this section shall not
apply with respect to any tax levied by a county, city, or district
pursuant to, or in accordance with, either of those laws.
   (e) This section shall be repealed on January 1, 2022.
  SEC. 4.  Section 10759.5 is added to the Revenue and Taxation Code,
to read:
   10759.5.  (a) For purposes of determining the vehicle license fee
imposed by this part, there are exempted from the determination of
market value  , the incremental cost  of a new motor
vehicle propelled by alternative fuels  , any amount allowed as
a c   redit under Section 30D of the Internal Revenue Code,
relating to new qualified plug-in electric drive motor vehicles, and
any amounts received, awarded, or allowed pursuant to a state
incentive program for the purchase or lease of an alternative fuel
vehicle, including, but not limited to, state income tax credits, the
Clean Vehicle Rebate Project, the California Hybrid and
Zero-Emission   Truck and Bus Voucher Incentive Project, and
the On-Road Heavy-Duty Voucher Incentive Program under the Carl
Moyer Program  . This exemption shall apply to the subsequent
payments of the vehicle license fee.
   (b) For purposes of this section,  the following shall
apply:  
   (1) "Incremental cost" means the amount equal to the reasonable
difference between the cost of the motor vehicle defined in
subdivision (a) and the cost of a comparable gasoline or diesel fuel
vehicle. This amount shall constitute the maximum incremental cost
for purposes of the exemption in subdivision (a), and shall be
reduced, as appropriate, in accordance with the actual sales price of
the vehicle. The actual incremental cost shall be stated in the
contract for sale or lease with the purchaser. 
    (2)     "Motor
  "motor  vehicle propelled by alternative fuels"
means a motor vehicle that operates some or all of the time on a fuel
other than gasoline or diesel.
   (c) This section shall become operative on January 1, 2014, and
shall remain in effect only until January 1, 2022, and as of that
date is repealed.
  SEC. 5.  This act provides for a tax levy within the meaning of
Article IV of the Constitution and shall go into immediate effect.