Support Services and the Sales Tax

Article 4 of Chapter 2 of Part 1 of Division 2 of the Revenue and Taxation Code deals with the inclusion of support services in the sales tax.

Section 6150 defines the following terms: “county,” “personal care services,” “gross receipts,” “provider,” “recipient,” “retail sale,” “sale,” “seller,” and “support services.”

Section 6151 provides that, for the privilege of selling support services at retail, the sales tax is extended to all providers at the rate of the gross receipts of any provider from the sale of all support services sold at retail in this state. The rate extended is the rate, as may be amended from time to time, imposed by Article 1 (commencing with Section 6051) plus the rate imposed by Section 35 of Article XIII of the California Constitution for the privilege of selling tangible personal property at retail in this state.

Section 6152 provides that, for the efficient administration of this article and the collection of tax from providers, a seller is required to register with the board, collect the tax from the provider, and report and pay the tax to the board.

Section 6154 provides that Article 1.1 of Chapter 5, pertaining to prepayment of taxes, does not apply to sellers until no later than three months after the date that federal approval is obtained.

Section 6156 requires a seller to file with the board an application which must state that the applicant will actively engage in arranging for the retail sale of support services.

Section 6158 requires the board to grant and issue a permit or permits to each applicant, except that the board must grant and issue a single permit to the State Department of Social Services without regard to its multiple places of business.

Section 6160 states that a permit issued must be held only by a seller that is actively engaged in arranging for the retail sale of support services.

Section 6162 specifies that a seller is a retailer.

Section 6164 requires every provider and seller to keep any records, receipts, invoices, and other pertinent papers in the form as the board may require.

Section 6166 states that the board, or any person authorized in writing by the board, may examine the books, papers, records, and equipment of any seller or provider, and may investigate the character of the business of the seller.

Section 6168 says that all revenues, less refunds, derived from the taxes extended by this article are deposited in the State Treasury to the credit of the Personal Care IHSS Quality Assurance Revenue Fund. The money in the fund is continuously appropriated to the State Department of Social Services for disbursement as set forth in Section 12306.6 of the Welfare and Institutions Code.

Section 6170 provides that this article becomes operative only if federal Medicaid approval sought by the Director of Health Care Services is granted.