Sales and use taxes: exemption: fixed price contract.

Existing law imposes a state sales and use tax on retailers and on the storage, use, or other consumption of tangible personal property in this state at the combined rate of 1 4 %"?> 714% of the gross receipts from the retail sale of tangible personal property in this state and of the sales price of tangible personal property purchased from any retailer for storage, use, or other consumption in this state. This bill would, during the period of the imposition of a 1% sales and use tax increase 1 4 %"?> commencing on April 1, 2009, exclude from that 1% rate of tax, the gross receipts from certain sales and uses of tangible personal property that are subject to a fixed price pursuant to a contract entered into prior to April 1, 2009. This bill would also, for any increase in the sales and use tax rate on and after January 1, 2010, exclude from that increased rate of tax, the gross receipts from certain sales and uses of tangible personal property that are subject to a fixed price pursuant to a contract entered into prior to the operative date of the sales and use tax rate increase. This bill would make certain legislative findings and declarations that a fixed price contract exemption serves a statewide public purpose. This bill would take effect immediately as a tax levy.