Bill Text: CA AB2192 | 2025-2026 | Regular Session | Amended

California Assembly Bill 2192

Bill Title: Sales and use taxes: farm equipment and machinery.

Sponsorship: Partisan Bill (Republican 1)

Status: (Introduced) 2026-04-27 - In committee: Set, second hearing. Held under submission. [AB2192 Detail]

Download: California-2025-AB2192-Amended.html

Amended IN Assembly April 20, 2026

Amended IN Assembly March 18, 2026

CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION

Assembly Bill

No. 2192

Introduced by Assembly Member Jeff Gonzalez

February 19, 2026

An act to ~~amend~~ amend, repeal, and add Section 6356.5 of the Revenue and Taxation Code, relating to taxation, and making an appropriation therefor, to take effect immediately, tax levy.

LEGISLATIVE COUNSEL'S DIGEST

AB 2192, as amended, Jeff Gonzalez. Sales and use taxes: farm equipment and machinery.

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 of, 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, farm equipment and machinery, and the parts thereof, purchased for use by a qualified person to be used primarily in producing and harvesting agricultural products.

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 excludes the tax exemption described above from being incorporated into certain local taxes pursuant to the Bradley-Burns Uniform Local Sales and Use Tax Law.

This bill ~~would~~ would, until January 1, 2032, delete that provision.

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 make an appropriation from the General Fund to the Controller to make the reimbursements to counties and cities.

Existing law requires any bill authorizing a new tax expenditure to contain, among other things, specific purposes that the tax expenditure will achieve, detailed performance indicators, and data collection requirements.
This bill also would include additional information required for any bill authorizing a new tax expenditure.

This bill would take effect immediately as a tax levy.

Vote: 2/3 Appropriation: YES Fiscal Committee: YES Local Program: NO

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

SECTION 1.

Section 6356.5 of the Revenue and Taxation Code is amended to read:

6356.5.

(a) There are exempted from the taxes imposed by this part the gross receipts from the sale of, and the storage and use of, or other consumption in this state of, farm equipment and machinery, and the parts thereof, purchased for use by a qualified person to be used primarily in producing and harvesting agricultural products.

(b) For purposes of this section:

(1) “Qualified person” means any person engaged in a line of business described in Codes 0111 to 0291, inclusive, of the Standard Industrial Classification Manual published by the United States Office of Management and Budget, 1987 Edition, and any other person that uses farm equipment and machinery to assist this person in the lines of business described in this paragraph in producing and harvesting agricultural products.

(2) “Farm equipment and machinery” means implements of husbandry, as defined in Section 411.

(c) Notwithstanding subdivision (a), the exemption established by this section does not apply with respect to any tax levied pursuant to Sections 6051.2 and 6201.2, or pursuant to Section 35 of Article XIII of the California Constitution.

(d) The exemption provided by this section shall be effective starting September 1, 2001.

(e) For the purpose of complying with Section 41, the Legislature finds the following with respect to the amendments made to this section by the act adding this subdivision:
(1) The specific goals of the exemption are as follows:
(A) To offset the growing cost of compliance in the State of California.
(B) To alleviate the cost of investing in new, cleaner farming equipment.
(2) The performance indicators for the Legislature to use in determining whether the exemption achieves the stated goal shall be the number of taxpayers claiming the exemption pursuant to this section and the total dollar value of exemptions allowed.
(f) This section shall be in effect only until January 1, 2032, and as of that date is repealed.

SEC. 2.

Section 6356.5 is added to the Revenue and Taxation Code, to read:

6356.5.
(a) There are exempted from the taxes imposed by this part the gross receipts from the sale of, and the storage and use of, or other consumption in this state of, farm equipment and machinery, and the parts thereof, purchased for use by a qualified person to be used primarily in producing and harvesting agricultural products.
(b) For purposes of this section:
(1) “Qualified person” means any person engaged in a line of business described in Codes 0111 to 0291, inclusive, of the Standard Industrial Classification Manual published by the United States Office of Management and Budget, 1987 Edition, and any other person that uses farm equipment and machinery to assist this person in the lines of business described in this paragraph in producing and harvesting agricultural products.
(2) “Farm equipment and machinery” means implements of husbandry, as defined in Section 411.
(c) (1) 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 exemption established by this section does not apply with respect to any tax levied by a county, city, or district pursuant to, or in accordance with, either of those laws.
(2) Notwithstanding subdivision (a), the exemption established by this section does not apply with respect to any tax levied pursuant to Sections 6051.2 and 6201.2, or pursuant to Section 35 of Article XIII of the California Constitution.
(d) The exemption provided by this section shall be effective starting September 1, 2001.
(e) This section shall become operative January 1, 2032.

SEC. 2.SEC. 3.

The sum of ~~200~~ two hundred million dollars ($200,000,000) is hereby appropriated to the Controller from the General Fund to make the payments to counties and cities required by Section 2230 of the Revenue and Taxation Code to reimburse them for revenue losses caused by this act in the initial fiscal year in which this act is effective. The appropriation made by this section shall be allocated in the manner specified in Section 2230.