Sales and use taxes: exemptions: fuel and petroleum products: air common carriers.

The Sales and Use Tax Law imposes a tax on retailers measured by the gross receipts from the sale of tangible personal property sold at retail in this state, or on the storage, use, or other consumption in this state of tangible personal property purchased from a retailer for storage, use, or other consumption in this state. That law provides various exemptions from that tax, including an exemption for the gross receipts from the sale of, and the storage, use, or other consumption of, fuel and petroleum products sold to an air common carrier for immediate consumption or shipment in the conduct of its business on an international flight. This bill would, on or after January 1, 2012, exempt from those state taxes, gross receipts or sales price in excess of the average spot price over the previous 5 years, per gallon, derived from the sale in this state of, and the storage, use, or other consumption in this state of, fuel and petroleum products sold to or purchased by an air common carrier for consumption or shipment in the conduct of its business on a domestic flight, as specified. The bill would repeal these provisions on January 1, 2017, unless the Legislative Analyst's Office, in cooperation with the Employment Development Department, makes a specified finding, in which case the bill would repeal these provisions on January 1, 2020. This bill would also require the State Board of Equalization, beginning on January 1, 2013, and annually thereafter, to submit a report to the Legislature setting forth the state fiscal impact of the exemption, and would require the Legislative Analyst's Office, in cooperation with the Employment Development Department, to submit a report to the Legislature and the Department of Finance on or before October 1, 2016, determining whether a net increase of 2,000 or more airline industry jobs have been or are expected to be created in California by the bill on or before January 1, 2017. The Bradley-Burns Uniform Local Sales and Use Tax Law authorizes counties and cities to impose local sales and use taxes in conformity with the Sales and Use Tax Law, and existing law authorizes districts, as specified, to impose transactions and use taxes in accordance with the Transactions and Use Tax Law, which conforms to the Sales and Use Tax Law. Exemptions from state sales and use taxes are incorporated into these laws. This bill would specify that this exemption does not apply to local sales and use taxes or transactions and use taxes. This bill would take effect immediately as a tax levy.