Imposition of Use Tax

Division 2, Part 1, Chapter 3, Article 1 deals with impose of the use tax in California. Section 6201 provides that an excise tax is imposed on the storage, use, or other consumption in this state of tangible personal property purchased from any retailer at the rate of 4³/₄ percent.

Section 6201.1 states that an excise tax is imposed on the storage, use, or other consumption in the state of tangible personal property purchased from any retailer on or after the operative date of this subdivision, for storage, use, or other consumption in this state at the rate of 5 percent of the sales price of the property on and after the operative date of this subdivision.

Section 6201.15 provides that the amount of revenues, net of refunds, collected and attributable to a rate of 1.0625 percent must be deposited in the State Treasury to the credit of the Local Revenue Fund 2011 and be used exclusively for the public safety purposes for which that fund was created.

Section 6201.2 provides an excise tax is imposed on the storage, use, or other consumption in this state of tangible personal property purchased from any retailer for storage, use, or other consumption in this state at the rate of ¹/₂ percent of the sales price of the property.

All revenues received pursuant to this section are deposited in the State Treasury to the credit of the Local Revenue Fund.

Section 6201.45 provides that the state use tax rate in Section 6201.3 is not operative in any calendar year if the Director of Finance determines both of the specified conditions exist.

Section 6201.6 specifies that there are exempted from the taxes imposed by Section 6201.5 the storage, use, or other consumption in this state of tangible personal property, other than fuel or petroleum products, by 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 the aircraft as common carriers of persons or property under the authority of the laws of this state, the United States, or any foreign government.

Section 6201.8 explains that an excise tax is imposed on the storage, use, or other consumption in this state of diesel fuel at the rate of 1.75 percent of the sales price of the diesel fuel. In addition, an excise tax is imposed on the storage, use, or other consumption in this state of diesel fuel at the rate of 4 percent of the sales price of the diesel fuel.

Section 6202 provides that every person storing, using, or otherwise consuming in this state tangible personal property purchased from a retailer is liable for the tax. His or her liability is not extinguished until the tax has been paid to this state, except that a receipt from a retailer engaged in business in this state or from a retailer who is authorized by the board, under the rules and regulations as it may prescribe, to collect the tax and who is, for the purposes of this part relating to the use tax, regarded as a retailer engaged in business in this state is sufficient to relieve the purchaser from further liability for the tax to which the receipt refers.

Section 6202.5 states that any retailer, other than a nonprofit zoological society, that stores, uses, or otherwise consumes in this state endangered or threatened animal or plant species acquired through a trade or exchange with a nonprofit zoological society, is liable for the use tax.

Section 6202.7 states that any retailer who loans any motor vehicle to any employee of the University of California or the California State University is liable for the use tax on the loan of that vehicle equal to the amount of tax that would have applied if the vehicle had been leased at fair rental value for a time period equal to the period the vehicle is loaned to the university or state university employee, provided that all three specified conditions are met.

Section 6203 provides that every retailer engaged in business in this state and making sales of tangible personal property for storage, use, or other consumption in this state, is required, at the time of making the sales or, if the storage, use, or other consumption of the tangible personal property is not then taxable hereunder, at the time the storage, use, or other consumption becomes taxable, collect the tax from the purchaser and give to the purchaser a receipt therefor in the manner and form prescribed by the board.

As respects leases constituting sales of tangible personal property, the tax must be collected from the lessee at the time amounts are paid by the lessee under the lease. The term “retailer engaged in business in this state.”

Section 6203.1 authorizes the department to relieve a retailer engaged in business in this state that meets the requirements of specified laws of certain penalties and interest. This section applies to any retailer engaged in business in this state that meets all of the six specified conditions are met.

Section 6203.5 provides that a retailer is relieved from liability to collect use tax that became due and payable, insofar as the measure of the tax is represented by accounts that have been found to be worthless and charged off for income tax purposes by the retailer or, if the retailer is not required to file income tax returns, charged off in accordance with generally accepted accounting principles.

A retailer that has previously paid the amount of the tax may, under rules and regulations prescribed by the department, take as a deduction the amount found worthless and charged off by the retailer. If these accounts are thereafter in whole or in part collected by the retailer, the amount collected is included in the first return filed after the collection and the amount of the tax to be paid with the return.

Section 6204 provides that the tax required to be collected by the retailer and any amount unreturned to the customer which is not tax but was collected from the customer under the representation by the retailer that it was tax constitutes debts owed by the retailer to this state.

Section 6205 makes it unlawful for any retailer to advertise or hold out or state to the public or to any customer, directly or indirectly, that the tax or any part thereof will be assumed or absorbed by the retailer or that it will not be added to the selling price of the property sold or that if added it or any part thereof will be refunded.

Section 6206 provides that the tax required to be collected by the retailer from the purchaser is to be displayed separately from the list price, the price advertised in the premises, the marked price, or other price on the sales check or other proof of sales.