Frequently Asked Questions about Tax Levies in California Bills

There is often confusion regarding whether a bill is a tax levy or not, and what a “tax levy” designation actually means. To make matters worse, a common misconception is that a tax levy is a bill that proposes a tax increase.

What is a “tax levy” for California bill purposes? A tax levy is a bill that proposes to change the base, rate, or burden of any tax.

Is the definition of a tax levy found in California law? Unfortunately, the term is not defined in either the state Constitution or in statute.

Who determines whether a bill is deemed a tax levy? The determination of whether a bill is a tax levy is done by the attorneys in the Office of Legislative Counsel.

What will bill readers see in a section at the end of a bill that is a tax levy? The following statement is a plus section in a tax levy bill: “This act provides for a tax levy within the meaning of Article IV of the California Constitution and shall go into immediate effect.”

When do tax levy statutes go into effect? Pursuant to Article IV, Section 8(c)(3) of the California Constitution, “statutes providing for tax levies … shall go into effect immediately upon their enactment.”

Is a tax levy bill always a tax increase? That is not always the case. While a tax levy bill can increase taxes, a tax levy bill can also reduce taxes. Basically, a “tax levy” means any bill that imposes, repeals, or materially alters a state tax.

Is a tax levy noted in a bill’s Title? Yes, specifically, the Title of the bill will contain, at the end of the Title, the following phrase: “… relating to taxation, to take effect immediately, tax levy.”

Is a tax levy noted in a bill’s Legislative Counsel’s Digest? Yes, the Legislative Counsel’s Digest will contain the following statement, generally at the end of the Digest: “This bill would take effect immediately as a tax levy.”