HomeMy WebLinkAbout16-06 CC Ordinance ORDINANCE NO. 16-06
AN ORDINANCE OF THE CITY OF TEMECULA
IMPOSING A TRANSACTIONS AND USE TAX TO BE
ADMINISTERED BY THE STATE BOARD OF
EQUALIZATION
Section 1. Title 3 ("Revenue and Finance") of the Temecula Municipal Code is
hereby amended by adding Chapter 3.18 ('Transactions and Use Tax") to read as
follows:
"CHAPTER 3.18, TRANSACTIONS AND USE TAX
3.18.010 TITLE. This chapter shall be known as the Temecula Transactions
and Use Tax Ordinance. The City of Temecula hereinafter shall be called "City."
This ordinance shall be applicable in the incorporated territory of the City.
3.18.020. OPERATIVE DATE. "Operative Date" means the first day of the
first calendar quarter commencing more than 110 days after the adoption of
Ordinance No. 2016-06.
3.18.030. PURPOSE. This chapter is adopted to achieve the following,
' among other purposes, and directs that the provisions hereof be interpreted in
order to accomplish those purposes:
A. To impose a retail transactions and use tax in accordance with the
provisions of Part 1.6 (commencing with Section 7251) of Division 2 of
the Revenue and Taxation Code and Section 7285.9 of Part 1.7 of
Division 2 which authorizes the City to adopt this tax ordinance which
shall be operative if a majority of the electors voting on the measure
vote to approve the imposition of the tax at an election called for that
purpose.
B. To adopt a retail transactions and use tax ordinance that incorporates
provisions identical to those of the Sales and Use Tax Law of the State
of California insofar as those provisions are not inconsistent with the
requirements and limitations contained in Part 1.6 of Division 2 of the
Revenue and Taxation Code.
C. To adopt a retail transactions and use tax ordinance that imposes a tax
and provides a measure therefore that can be administered and
collected by the State Board of Equalization in a manner that adapts
itself as fully as practicable to, and requires the least possible deviation
from, the existing statutory and administrative procedures followed by
the State Board of Equalization in administering and collecting the
California State Sales and Use Taxes.
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' D. To adopt a retail transactions and use tax ordinance that can be
administered in a manner that will be, to the greatest degree possible,
consistent with the provisions of Part 1.6 of Division 2 of the Revenue
and Taxation Code, minimize the cost of collecting the transactions
and use taxes, and at the same time, minimize the burden of record
keeping upon persons subject to taxation under the provisions of this
ordinance.
3.18.040. CONTRACT WITH STATE. Prior to the operative date of this
chapter, the City shall contract with the State Board of Equalization to perform all
functions incident to the administration and operation of this transactions and use
tax ordinance; provided, that if the City has not contracted with the State Board of
Equalization prior to the operative date, it shall nevertheless so contract, and in
such a case the operative date shall be the first day of the first calendar quarter
following the execution of such a contract.
3.18.050. TRANSACTIONS TAX RATE. For the privilege of selling tangible
personal property at retail, a tax is hereby imposed upon all retailers in the
incorporated territory of the City at the rate of 1.0% of the gross receipts of any
retailer from the sale of all tangible personal property sold at retail in said territory
on and after the operative date of this ordinance.
' 3.18.060. PLACE OF SALE. For the purposes of this chapter, all retail sales
are consummated at the place of business of the retailer unless the tangible
personal property sold is delivered by the retailer or his agent to an out-of-state
destination or to a common carrier for delivery to an out-of-state destination. The
gross receipts from such sales shall include delivery charges, when such
charges are subject to the State sales and use tax, regardless of the place to
which delivery is made. In the event a retailer has no permanent place of
business in the State or has more than one place of business, the place or
places at which the retail sales are consummated shall be determined under
rules and regulations to be prescribed and adopted by the State Board of
Equalization.
3.18.070. USE TAX RATE. An excise tax is hereby imposed on the storage,
use or other consumption in the City of tangible personal property purchased
from any retailer on and after the operative date of this ordinance for storage, use
or other consumption in said territory at the rate of 1.0% of the sales price of the
property. The sales price shall include delivery charges when such charges are
subject to State sales or use tax regardless of the place to which delivery is
made.
3.18.080. ADOPTION OF PROVISIONS OF STATE LAW. Except as
otherwise provided in this chapter and except insofar as they are inconsistent
with the provisions of Part 1.6 of Division 2 of the Revenue and Taxation Code,
all of the provisions of Part 1 (commencing with Section 6001) of Division 2 of the
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Revenue and Taxation Code are hereby adopted and made a part of this
' ordinance as though fully set forth herein.
3.18.090. LIMITATIONS ON ADOPTION OF STATE LAW AND
COLLECTION OF USE TAXES. In adopting the provisions of Part 1 of Division
2 of the Revenue and Taxation Code:
A. Wherever the State of California is named or referred to as the
taxing agency, the name of this City shall be substituted therefor.
However, the substitution shall not be made when:
1. The word "State" is used as a part of the title of the State
Controller, State Treasurer, State Board of Equalization, State
Treasury, or the Constitution of the State of California;
2. The result of that substitution would require action to be taken
by or against this City or any agency, officer, or employee
thereof rather than by or against the State Board of
Equalization, in performing the functions incident to the
administration or operation of this ordinance.
3. In those sections, including, but not necessarily limited to
' sections referring to the exterior boundaries of the State of
California, where the result of the substitution would be to:
a. Provide an exemption from this tax with respect to certain
sales, storage, use or other consumption of tangible
personal property which would not otherwise be exempt
from this tax while such sales, storage, use or other
consumption remain subject to tax by the State under the
provisions of Part 1 of Division 2 of the Revenue and
Taxation Code, or;
b. Impose this tax with respect to certain sales, storage, use
or other consumption of tangible personal property which
would not be subject to tax by the State under the said
provision of that code.
4. In Sections 6701, 6702 (except in the last sentence thereof),
6711, 6715, 6737, 6797 or 6828 of the Revenue and Taxation
Code.
B. The word "City" shall be substituted for the word "State" in the
phrase "retailer engaged in business in this State" in Section 6203
' and in the definition of that phrase in Section 6203.
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' 3.18.100. PERMIT NOT REQUIRED. If a seller's permit has been issued to a
retailer under Section 6067 of the Revenue and Taxation Code, an additional
transactor's permit shall not be required by this ordinance.
3.18.110. EXEMPTIONS AND EXCLUSIONS.
A. There shall be excluded from the measure of the transactions and use
tax the amount of any sales tax or use tax imposed by the State of
California or by any city, city and county, or county pursuant to the
Bradley-Burns Uniform Local Sales and Use Tax Law or the amount of
any state-administered transactions and use tax.
B. There are exempted from the computation of the amount of
transactions tax the gross receipts from:
1. Sales of tangible personal property, other than fuel or petroleum
products, to operators of aircraft to be used or consumed
principally outside the county in which the sale is made and
directly and exclusively in the use of such aircraft as common
carriers of persons or property under the authority of the laws of
this State, the United States, or any foreign government.
' 2. Sales of property to be used outside the City which is shipped to
a point outside the City, pursuant to the contract of sale, by
delivery to such point by the retailer or his agent, or by delivery
by the retailer to a carrier for shipment to a consignee at such
point. For the purposes of this paragraph, delivery to a point
outside the City shall be satisfied:
a. With respect to vehicles (other than commercial vehicles)
subject to registration pursuant to Chapter 1
(commencing with Section 4000) of Division 3 of the
Vehicle Code, aircraft licensed in compliance with
Section 21411 of the Public Utilities Code, and
undocumented vessels registered under Division 3.5
(commencing with Section 9840) of the Vehicle Code by
registration to an out-of-City address and by a declaration
under penalty of perjury, signed by the buyer, stating that
such address is, in fact, his or her principal place of
residence; and
b. With respect to commercial vehicles, by registration to a
place of business out-of-City and declaration under
' penalty of perjury, signed by the buyer, that the vehicle
will be operated from that address.
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' 3. The sale of tangible personal property if the seller is obligated to
furnish the property for a fixed price pursuant to a contract
entered into prior to the operative date of this ordinance.
4. A lease of tangible personal property which is a continuing sale
of such property, for any period of time for which the lessor is
obligated to lease the property for an amount fixed by the lease
prior to the operative date of this ordinance.
5. For the purposes of subparagraphs (3) and (4) of this section,
the sale or lease of tangible personal property shall be deemed
not to be obligated pursuant to a contract or lease for any period
of time for which any party to the contract or lease has the
unconditional right to terminate the contract or lease upon
notice, whether or not such right is exercised.
C. There are exempted from the use tax imposed by this ordinance, the
storage, use or other consumption in this City of tangible personal
property:
1 . The gross receipts from the sale of which have been subject to
a transactions tax under any state-administered transactions
' and use tax ordinance.
2. Other than fuel or petroleum products purchased by operators
of aircraft and used or consumed by such operators directly and
exclusively in the use of such aircraft as common carriers of
persons or property for hire or compensation under a certificate
of public convenience and necessity issued pursuant to the laws
of this State, the United States, or any foreign government. This
exemption is in addition to the exemptions provided in Sections
6366 and 6366.1 of the Revenue and Taxation Code of the
State of California.
3. If the purchaser is obligated to purchase the property for a fixed
price pursuant to a contract entered into prior to the operative
date of this ordinance.
4. If the possession of, or the exercise of any right or power over,
the tangible personal property arises under a lease which is a
continuing purchase of such property for any period of time for
which the lessee is obligated to lease the property for an
amount fixed by a lease prior to the operative date of this
ordinance.
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' 5. For the purposes of subparagraphs (3) and (4) of this section,
storage, use, or other consumption, or possession of, or
exercise of any right or power over, tangible personal property
shall be deemed not to be obligated pursuant to a contract or
lease for any period of time for which any party to the contract
or lease has the unconditional right to terminate the contract or
lease upon notice, whether or not such right is exercised.
6. Except as provided in subparagraph (7), a retailer engaged in
business in the City shall not be required to collect use tax from
the purchaser of tangible personal property, unless the retailer
ships or delivers the property into the City or participates within
the City in making the sale of the property, including, but not
limited to, soliciting or receiving the order, either directly or
indirectly, at a place of business of the retailer in the City or
through any representative, agent, canvasser, solicitor,
subsidiary, or person in the City under the authority of the
retailer.
7. "A retailer engaged in business in the City" shall also include
any retailer of any of the following: vehicles subject to
registration pursuant to Chapter 1 (commencing with Section
' 4000) of Division 3 of the Vehicle Code, aircraft licensed in
compliance with Section 21411 of the Public Utilities Code, or
undocumented vessels registered under Division 3.5
(commencing with Section 9840) of the Vehicle Code. That
retailer shall be required to collect use tax from any purchaser
who registers or licenses the vehicle, vessel, or aircraft at an
address in the City.
D. Any person subject to use tax under this ordinance may credit against
that tax any transactions tax or reimbursement for transactions tax paid
to a district imposing, or retailer liable for a transactions tax pursuant to
Part 1.6 of Division 2 of the Revenue and Taxation Code with respect
to the sale to the person of the property the storage, use or other
consumption of which is subject to the use tax.
3.18.120. AMENDMENTS. All amendments subsequent to the effective date of
this chapter to Part 1 of Division 2 of the Revenue and Taxation Code relating to
sales and use taxes and which are not inconsistent with Part 1.6 and Part 1.7 of
Division 2 of the Revenue and Taxation Code, and all amendments to Part 1.6
and Part 1.7 of Division 2 of the Revenue and Taxation Code, shall automatically
become a part of this chapter, provided however, that no such amendment shall
' operate so as to affect the rate of tax imposed by this ordinance. The City
Council shall have the authority to amend this chapter so as to implement any
changes or additions required by the State Board of Equalization or other State
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' agency for the administration of the tax, provided however, that no such
amendment shall operate so as to affect the rate of tax imposed by this
ordinance.
3.18.130. ENJOINING COLLECTION FORBIDDEN. No injunction or writ of
mandate or other legal or equitable process shall issue in any suit, action or
proceeding in any court against the State or the City, or against any officer of the
State or the City, to prevent or enjoin the collection under this chapter, or Part 1.6
of Division 2 of the Revenue and Taxation Code, of any tax or any amount of tax
required to be collected.
3.18.140. SEVERABILITY. If any provision of this chapter or the application
thereof to any person or circumstance is held invalid by a court of law, the
remainder of the chapter and the application of such provision to other persons
or circumstances shall not be affected thereby.
3.18.150. INDEPENDENT FINANCIAL AUDIT. By no later than December 31
of each year, the City's independent auditors shall complete a Temecula
Transactions and Use Tax Ordinance Compliance and Internal Control Audit
Report. Such report shall review whether the tax revenues collected pursuant to
this chapter are collected, managed and expended in accordance with the
requirements of this ordinance."
' Section 2. This ordinance relates to the levying and collecting of the City's
transactions and use taxes and shall take effect immediately.
Section 3. The City Clerk shall certify the passage of this ordinance and forward a
copy of the adopted ordinance to the State Board of Equalization.
PASSED AND ADOPTED by the People of the City of Temecula, State of California,
at the General Municipal Election held on November 8, 2016.
)V
Michael S. Naggar, Mayor
Attest,
Rand- , City Clerk
1
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