Sales and use taxes: exemption: food products.

Existing sales and use tax laws impose 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. These laws provide various exemptions from these taxes, including an exemption for food products, which, pursuant to Proposition 163, approved by the voters on November 3, 1992, are required to include, among other items, candy, confectionery, and snack foods. Assembly Constitutional Amendment 2 of the 2017–18 Regular Session, if approved by the voters, on and after a specified date, would instead require that any sales or use taxes levied by the state or any of its political subdivisions apply to the sale of, or the storage, use, or other consumption in this state of, certain food products for human consumption, which include candy, confectionery, and snack foods. Assembly Constitutional Amendment 2, if approved by the voters, would authorize the Legislature to exempt the sale of, or the storage, use, or other consumption in this state of, any food product from sales and use taxes by a statute that becomes operative on or after November 7, 2018. This bill, on and after July 1, 2019, would exempt from those taxes the gross receipts from the sale of, and the storage, use, or other consumption in this state of those certain, food products for human consumption subject to those taxes pursuant to Assembly Constitutional Amendment 2 of the 2017–18 Regular Session, except for food products that are candy or confectionery, as defined, or processed snacks, as defined. 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 laws authorize districts, as specified, to impose transactions and use taxes in accordance with the Transactions and Use Tax Law, which generally conforms to the Sales and Use Tax Law. Amendments to the Sales and Use Tax Law are automatically incorporated into the local tax laws. Existing law requires the state to reimburse counties and cities for revenue losses caused by the enactment of sales and use tax exemptions. This bill would provide that, notwithstanding these provisions, no appropriation is made and the state shall not reimburse any local agencies for sales and use tax revenues lost by them pursuant to this bill. This bill would take effect immediately as a tax levy, but would become operative on November 7, 2018, only if Assembly Constitutional Amendment 2 of the 2017–18 Regular Session is submitted to, and approved by, the voters.