Taxation.
Vote required
Two Thirds
Fiscal committee
No
Appropriation
No
Current location
Chaptered
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Progress
Where this bill stands in the legislative process.
- Introduced
- Passed Senate
- Passed Assembly
- To Governor
- Became Law
Overview
This bill updates California’s sales and use tax laws to include digital products, such as software and copyrighted materials, in the scope of taxation. It establishes rules for determining where a sale of a digital product occurs, creates a process for local agencies to prevent tax revenue sharing agreements that could result in lost tax revenue, and modifies rules related to business tax credits and franchise taxes. The bill also includes appropriations for administering these changes.
Key provisions
- Defines ‘digital product’ to include prewritten computer software, copyright, and patent interests.
- Establishes rules for determining the ‘place of sale’ for digital products transferred electronically or accessed remotely.
- Prohibits local agencies from entering agreements that would result in lost sales tax revenue from digital product sales.
- Extends the limitation on business tax credits through 2030 and creates exceptions for refundable credits.
- Reduces the annual franchise tax for limited partnerships, limited liability partnerships, and limited liability companies to $400 starting in 2027.
- Imposes a 100% tax on settlement fund payments from the federal Anti-Weaponization Fund.
- Creates a process for retailers to obtain a use tax direct payment permit to self-assess and pay state and local use taxes.
- Includes an appropriation of $750,000 to the California Department of Tax and Fee Administration.
Who is affected
Bill text
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Sponsors
Official sponsors from legislative records.
1 on record
Primary sponsor
Committee on Budget and Fiscal Review
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