6-2
SALES AND USE TAX.1
6-2.1 Title.
This section shall be known as the Uniform Local Sales and Use Tax Ordinance of the City. (Code 1972, §30-18)
6-2.2 Purpose of This Section.
The Council hereby declares that this section is adopted to achieve the following purposes, among others, and directs that the provisions hereof be interpreted in order to accomplish those purposes:
a. To adopt a sales and use tax regulation which complies with the requirements and limitations contained in Part 1.5 of Division 2 of the Revenue and Taxation Code of the State.
b. To adopt a sales and use tax regulation which incorporates provisions identical to those of the Sales and Use Tax Law of the State insofar as those provisions are not inconsistent with the requirements and limitations contained in Part 1.5 of Division 2 of the Revenue and Taxation Code.
c. To adopt a sales and use tax regulation which imposes a one (1%) percent tax and provides a measure therefor that can be administered and collected by the State Board of Equalization in a manner that adapts itself as fully as practical to, and requires the least possible deviation from the existing statutory and administrative procedures followed by the State Board of Equalization in administering the collection of the State sales and use taxes.
d. To adopt a sales and use tax regulation which can be administered in a manner that will, to the degree possible consistent with the provisions of Part 1.5 of Division 2 of the Revenue and Taxation Code, minimize the cost of collecting City sales and use taxes and at the same time minimize the burden of record keeping upon persons subject to taxation under this section.
(Code 1972 §30-19)
6-2.3 Operative Date; Contract with State.
This section shall become operative on April 1, 1956 and, prior thereto, the City shall contract with the State Board of Equalization to perform all functions incident to the administration of this section. (Code 1972 §30-20)
6-2.4 Sales Tax Imposed.
a. For the privilege of selling tangible personal property at retail, a tax is hereby imposed upon all retailers in the City at the rate of one (1%) percent of the gross receipts of the retailer from the sale of all tangible personal property sold at retail in the City on and after the operative date of this section, as established in this section.
b. For the purposes of this section, all retail sales are consummated at the place of business of the retailer unless the tangible personal property sold is delivered by the retailer or his agent to an out-of-state destination or to a common carrier for delivery to an out-of-state destination. The gross receipts from such sales shall include delivery charges, when such charges are subject to the State sales and use tax, regardless of the place to which delivery is made. In the event a retailer has no permanent place of business in the State or has more than one (1) place of business, the place or places at which the retail sales are consummated shall be determined under rules and regulations to be prescribed and adopted by the Board of Equalization.
c. Except as provided in this subsection and except insofar as they are inconsistent with the provisions of Part 1.5 of Division 2 of the State Revenue and Taxation Code, all of the provisions of Part 1 of Division 2 of such Code, as amended, applicable to sales taxes are hereby adopted and made a part of this section as though fully set forth in this subsection.
d. Wherever, and to the extent that in Part 1 of Division 2 of the Revenue and Taxation Code the State is named or referred to as the “taxing agency”, the City shall be substituted. Nothing in this paragraph shall be deemed to require the substitution of the name of the City for the word “State” when that word is used as part of the title of the State Controller, the State Treasurer, the State Board of Control, the State Board of Equalization, the name of the State Treasury or of the constitution of the State, nor shall the name of the City be substituted for that of the State in any section when the result of that substitution would require action to betaken by or against the City or any agency thereof, rather than by or against the State Board of Equalization, in performing the functions incident to the administration or operation of this section, and neither shall the substitution be deemed to have been made in those sections, including, but not necessarily limited to, sections referring to the exterior boundaries of the State, where the result of the substitution would be to provide an exemption from this tax with respect to certain gross receipts which would not otherwise be exempt from this tax while those gross receipts remain subject to tax by the State under the provisions of Part 1 of Division 2 of the Revenue and Taxation Code; nor to impose this tax with respect to certain gross receipts which would not be subject to tax by the State under the provisions of that code; and in addition, the name of the City shall not be substituted for that of the State in Sections 6701, 6702, (except in the last sentence thereof) 6711, 6715, 6737, 6797 and 6828 of the Revenue and Taxation Code, as adopted.
e. If a seller’s permit has been issued to a retailer under Section 6067 of the Revenue and Taxation Code, an additional seller’s permit shall not be required by reason of this subsection.
f. There shall be excluded from the gross receipts by which the tax is measured:
1. The amount of any sales or use tax imposed by the State upon a retailer or consumer.
2. The gross receipts from the sale of tangible personal property to operators of aircraft to be used or consumed principally outside the City in which the sale is made and directly and exclusively in the use of such aircraft as common carriers of persons or property under the authority of the laws of this state, the United States, or any foreign government.
(Code 1972 §30; Ord. #955, §§1, 2; Ord. #1217, §§1, 3, 5, 6; New)
6-2.5 Use Tax Imposed.
a. An excise tax is hereby imposed on the storage, use or other consumption in the City of tangible personal property purchased from any retailer on or after the operative date of this section, as established in this section, for the storage, use or other consumption in the City at the rate of one (1%) percent of the sales price of the property. The sales price shall include delivery charges when such charges are subject to state sales or use tax regardless of the place to which delivery is made.
b. Except as provided in this subsection, and except insofar as they are inconsistent with the provisions of Part 1.5 of Division 2 of the Revenue and Taxation Code, all of the provisions of Part 1 of Division 2 of such Code, as amended and in force and effect on April 1, 1956, applicable to use taxes, are hereby adopted and made a part of this section as though fully set forth herein.
c. Wherever, and to the extent that, in Part 1 of Division 2 of the Revenue and Taxation Code of the State is named or referred to as the “taxing agency”, the name of this City shall be substituted therefor. Nothing in this paragraph shall be deemed to require the substitution of the name of this City for the word “State” when that word is used as part of the title of the State Controller, the State Treasurer, the State Board of Control, the State Board of Equalization, or the name of the State Treasury, or of the Constitution of the State; nor shall the name of the City be substituted for that of the State in any section when the result of that substitution would require action to be taken by or against the City or any agency thereof rather than by or against the State Board of Equalization, in performing the functions incident to the administration or operation of this section, and neither shall the substitution be deemed to have been made in those sections, including but not necessarily limited to, sections referring to the exterior boundaries of the State, where the result of the substitution would be to provide an exemption from this tax with respect to certain storage, use or other consumption of tangible personal property which would not otherwise be exempt from this tax while such storage, use or other consumption remains subject to tax by the State under the provisions of Part 1 of Division 2 of the Revenue and Taxation Code, or to impose this tax with respect to certain storage, use or other consumption of tangible personal property which would not be subject to tax by the State under the provisions of that Code; and in addition, the name of the City shall not be substituted for that of the State under the provisions of that Code; and in addition, the name of the City shall not be substituted for that of the State in Sections 6701, 6702, except in the last sentence thereof, 6711, 6715, 6737, 6797 and 6828 of the Revenue and Taxation Code as adopted, and the name of the city shall not be substituted for the word “State” in the
phrase "retailer engaged in business in this State" in section 6203 nor in the definition of that phrase in section 6203.
d. There shall be exempt from the tax due under this subsection:
1. The amount of any sales or use tax imposed by the state of California upon a retailer or consumer;
2. The storage, use or other consumption of tangible personal property, the gross receipts from the sale of which has been subject to sales tax under a sales and use tax ordinance enacted in accordance with part 1.5 of division 2 of the Revenue and Taxation Code by any city and county, county, or city in this state;
3. In addition to the exemptions provided in sections 6366 and 6366.1 of the Revenue and Taxation Code, the storage, use, or other consumption of tangible personal property purchased by operators of aircraft and used or consumed by such operators directly and exclusively in the use of such aircraft as common carriers of persons or property for hire or compensation under a certificate of public convenience and necessity issued pursuant to the laws of this state, the United States or any foreign government. (Code 1972 §30-22; Ord. #1217; New)
6-2.6 Effect Of Amendments To The State Law:
All amendments of the Revenue and Taxation Code enacted subsequent to the effective date of this section, as established in this section, which relate to the sales and use tax and which are not inconsistent with part 1.5 of Division 2 of the Revenue and Taxation Code shall automatically become a part of this section. (Code 1972 §30-24)
6-2.7 Suits To Enjoin Collection:
No injunction or writ of mandate or other legal or equitable process shall issue in any suit, action or proceeding in any court against the state or the city or against any officer of the state or the city to prevent or enjoin the collection under this section or under part 1.5 of division 2 of the Revenue and Taxation Code of any tax or any amount of tax required to be collected. (Code 1972 §30-25)
6-2.8 Suspension Of Ordinances 484 And 509 Relative To Sales And Use Taxes:
At the time this section goes into operation, the provisions of ordinances 484 and 509 of the city shall be suspended and shall not again be of any force or effect and unless for any reason the state board of equalization ceases to perform the functions incident to the administration and operation of the sales and use tax imposed by this section; however, if for any reason it is determined that the city is without power to adopt this section, or that the state board of equalization is without power to perform the functions incident to the administration and operation of the taxes imposed by this section, the provisions of ordinances 484 and 509 shall not be deemed to have been suspended, but shall be deemed to have been in full force and effect at the rate of one-half of one percent (0.5%) continuously from and after April 1, 1956. Upon the ceasing of the state board of equalization to perform the functions incident to the administration and operation of the taxes imposed by this section, the provisions of ordinance 484 and 509 shall again be in full force and effect at the rate of one-half of one percent (0.5%). Nothing in this section shall be construed as relieving any person of the obligation to pay to the city any sales or use tax accrued and owing by reason of the provisions of ordinances 484 and 509 in force and effect prior to and including March 31, 1956. (Code 1972 §30-26)
6-2.9 Transactions And Use Tax:
a. Title. This section shall be known as the city of Lynwood Transactions and Use Tax Ordinance. The city of Lynwood hereinafter shall be called "city." This section shall be applicable in the incorporated territory of the city.
b. Operative Date. Operative date means the first day of the first calendar quarter commencing more than one hundred ten (110) days after the adoption of the ordinance codified in this section, the date of such adoption being as set forth in the ordinance codified in this section.
c. Purpose. This section is adopted to achieve the following, among other purposes, and directs that the provisions hereof be interpreted in order to accomplish those purposes:
1. To impose a retail transactions and use tax in accordance with the provisions of Part 1.6 (commencing with Section 7251) of Division 2 of the California Revenue and Taxation Code and Section 7285.9 of Part 1.7 of Division 2 which authorizes the city to adopt the tax ordinance codified in this section, which shall be operative if a majority of the electors voting on the measure vote to approve the imposition of the tax at an election called for that purpose.
2. To adopt a retail transactions and use tax ordinance that incorporates provisions identical to those of the sales and use tax law of the state of California insofar as those provisions are not inconsistent with the requirements and limitations contained in Part 1.6 of Division 2 of the Revenue and Taxation Code.
3. To adopt a retail transactions and use tax ordinance that imposes a tax and provides a measure therefor that can be administered and collected by the State Board of Equalization in a manner that adapts itself as fully as practicable to, and requires the least possible deviation from, the existing statutory and administrative procedures followed by the State Board of Equalization in administering and collecting the California State sales and use taxes.
4. To adopt a retail transactions and use tax ordinance that can be administered in a manner that will be, to the greatest degree possible, consistent with the provisions of Part 1.6 of Division 2 of the Revenue and Taxation Code, minimize the cost of collecting the transactions and use taxes, and, at the same time, minimize the burden of record keeping upon persons subject to taxation under the provisions of this section.
d. Contract with State. Prior to the operative date, the city shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of the transactions and use tax ordinance codified in this section; provided, that if the city shall not have contracted with the State Board of Equalization prior to the operative date, it shall nevertheless so contract and in such a case the operative date shall be the first day of the first calendar quarter following the execution of such a contract.
e. Transactions Tax Rate. For the privilege of selling tangible personal property at retail, a tax is hereby imposed upon all retailers in the incorporated territory of the city at the rate of one percent (1.0%) of the gross receipts of any retailer from the sale of all tangible personal property sold at retail in said territory on and after the operative date of the ordinance codified in this section. The rate shall remain at one percent (1.0%) for the term of the tax.
f. Place of Sale. For the purposes of this section, all retail sales are consummated at the place of business of the retailer unless the tangible personal property sold is delivered by the retailer or his agent to an out-of-state destination or to a common carrier for delivery to an out-of-state destination. The gross receipts from such sales shall include delivery charges, when such charges are subject to the state sales and use tax, regardless of the place to which delivery is made. In the event retailer has no permanent place of business in the state or has more than one place of business, the place or places at which the retail sales are consummated shall be determined under rules and regulations to be prescribed and adopted by the State Board of Equalization.
g. Use Tax Rate. An excise tax is hereby imposed on the storage, use or other consumption in the city of tangible personal property purchased from any retailer on and after the operative date of the ordinance codified in this section for storage, use or other consumption in said territory at the rate of one percent (1.0%) of the sales price of the property. The sales price shall include delivery charges when such charges are subject to state sales or use tax regardless of the place to which delivery is made. The rate shall remain at one percent (1.0%) for the term of the tax.
h. Adoption of Provisions of State Law. Except as otherwise provided in this section and except insofar as they are inconsistent with the provisions of Part 1.6 of Division 2 of the Revenue and Taxation Code, all of the provisions of Part 1 (commencing with Section 6001) of Division 2 of the Revenue and Taxation Code are hereby adopted and made a part of this section as though fully set forth herein.
i. Limitations on Adoption of State Law and Collection of Use Taxes. In adopting the provisions of Part 1 of Division 2 of the Revenue and Taxation Code:
1. Wherever the state of California is named or referred to as the taxing agency, the name of this city shall be substituted therefor. However, the substitution shall not be made when:
(a) The word "State" is used as a part of the title of the State Controller, State Treasurer, State Board of Equalization, State Treasury, or the Constitution of the State of California;
(b) The result of that substitution would require action to be taken by or against this city or any agency, officer, or employee thereof rather than by or against the State Board of Equalization, in performing the functions incident to the administration or operation of this section;
(c) In those sections, including, but not necessarily limited to, sections referring to the exterior boundaries of the state of California, where the result of the substitution would be to:
(1) Provide an exemption from this tax with respect to certain sales, storage, use or other consumption of tangible personal property which would not otherwise be exempt from this tax while such sales, storage, use or other consumption remain subject to tax by the state under the provisions of Part 1 of Division 2 of the Revenue and Taxation Code; or
(2) Impose this tax with respect to certain sales, storage, use or other consumption of tangible personal property which would not be subject to tax by the state under the said provision of that code.
(d) In Sections 6701, 6702 (except in the last sentence thereof), 6711, 6715, 6737, 6797 or 6828 of the Revenue and Taxation Code.
2. The word "city" shall be substituted for the word "State" in the phrase "retailer engaged in business in this State" in Section 6203 and in the definition of that phrase in Section 6203.
j. Permit Not Required. If a seller’s permit has been issued to a retailer under Section 6067 of the Revenue and Taxation Code, an additional transactor’s permit shall not be required by this section.
k. Exemptions and Exclusions.
1. There shall be excluded from the measure of the transactions tax and the use tax the amount of any sales tax or use tax imposed by the state of California or by any city, city and county, or county pursuant to the Bradley-Burns Uniform Local Sales and Use Tax Law or the amount of any state-administered transactions or use tax.
2. There are exempted from the computation of the amount of transactions tax the gross receipts from:
(a) Sales of tangible personal property, other than fuel or petroleum products, to operators of aircraft to be used or consumed principally outside the county in which the sale is made and directly and exclusively in the use of such aircraft as common carriers of persons or property under the authority of the laws of this state, the United States, or any foreign government.
(b) Sales of property to be used outside the city which is shipped to a point outside the city, pursuant to the contract of sale, by delivery to such point by the retailer or his agent, or by delivery by the retailer to a carrier for shipment to a consignee at such point. For the purposes of this subsection, delivery to a point outside the city shall be satisfied:
(1) With respect to vehicles (other than commercial vehicles) subject to registration pursuant to Chapter 1 (commencing with Section 4000) of Division 3 of the Vehicle Code, aircraft licensed in compliance with Section 21411 of the Public Utilities Code, and undocumented vessels registered under Division 3.5 (commencing with Section 9840) of the Vehicle Code by registration to an out-of-city address and by a declaration under penalty of perjury, signed by the buyer, stating that such address is, in fact, his or her principal place of residence; and
(2) With respect to commercial vehicles, by registration to a place of business out-of-city and declaration under penalty of perjury, signed by the buyer, that the vehicle will be operated from that address.
(c) The sale of tangible personal property if the seller is obligated to furnish the property for a fixed price pursuant to a contract entered into prior to the operative date of the ordinance codified in this section.
(d) A lease of tangible personal property which is a continuing sale of such property, for any period of time for which the leaser is obligated to lease the property for an amount fixed by the lease prior to the operative date of the ordinance codified in this section.
(e) For the purposes of subsections 6-2.9k2c and d, the sale or lease of tangible personal property shall be deemed not to be obligated pursuant to a contract or lease for any period of time for which any party to the contract or lease has the unconditional right to terminate the contract or lease upon notice, whether or not such right is exercised.
3. There are exempted from the use tax imposed by this section the storage, use or other consumption in this city of tangible personal property.
(a) The gross receipts from the sale of which have been subject to a transactions tax under any state-administered transactions and use tax ordinance.
(b) Other than fuel or petroleum products purchased by operators of aircraft and used or consumed by such operators directly and exclusively in the use of such aircraft as common carriers of persons or property for hire or compensation under a certificate of public convenience and necessity issued pursuant to the laws of this state, the United States, or any foreign government. This exemption is in addition to the exemptions provided in Sections 6366 and 6366.1 of the Revenue and Taxation Code of the State of California.
(c) If the purchaser is obligated to purchase the property for a fixed price pursuant to a contract entered into prior to the operative date of the ordinance codified in this section.
(d) If the possession of, or the exercise of any right or power over, the tangible personal property arises under a lease which is a continuing purchase of such property for any period of time for which the lessee is obligated to lease the property for an amount fixed by a lease prior to the operative date of the ordinance codified in this section.
(e) For the purposes of subsections 6-2.9k3c and d, storage, use, or other consumption, or possession of, or exercise of any right or power over, tangible personal property shall be deemed not to be obligated pursuant to a contract or lease for any period of time for which any party to the contract or lease has the unconditional right to terminate the contract or lease upon notice, whether or not such right is exercised.
(f) Except as provided in subsection 6-2.9k3g, a retailer engaged in business in the city shall not be required to collect use tax from the purchaser of tangible personal property, unless the retailer ships or delivers the property into the city or participates within the city in making the sale of the property, including, but not limited to, soliciting or receiving the order, either directly or indirectly, at a place of business of the retailer in the city or through any representative, agent, canvasser, solicitor, subsidiary, or person in the city under the authority of the retailer.
(g) "A retailer engaged in business in the city" shall also include any retailer of any of the following: vehicles subject to registration pursuant to Chapter 1 (commencing with Section 4000) of Division 3 of the Vehicle Code, aircraft licensed in compliance with Section 21411 of the Public Utilities Code, or undocumented vessels registered under Division 3.5 (commencing with Section 9840) of the Vehicle Code. That retailer shall be required to collect use tax from any purchaser who registers or licenses the vehicle, vessel, or aircraft at an address in the city.
4. Any person subject to use tax under this section may credit against that tax any transactions tax or reimbursement for transactions tax paid to a district imposing or retailer liable for a transactions tax pursuant to Part 1.6 of Division 2 of the Revenue and Taxation Code with respect to the sale to the person of the property the storage, use or other consumption of which is subject to the use tax.
l. Amendments. All amendments subsequent to the effective date of the ordinance codified in this section to Part 1 of Division 2 of the Revenue and Taxation Code relating to sales and use taxes and which are not inconsistent with Part 1.6 and Part 1.7 of Division 2 of the Revenue and Taxation Code, and all amendments to Part 1.6 and Part 1.7 of Division 2 of the Revenue and Taxation Code, shall automatically become a part of this section; provided, however, that no such amendment shall operate so as to affect the rate of tax imposed by this section.
m. Enjoining Collection Forbidden. No injunction or writ of mandate or other legal or equitable process shall issue in any suit, action or proceeding in any court against the state or the city, or against any officer of the state or the city, to prevent or enjoin the collection under this section, or Part 1.6 of Division 2 of the Revenue and Taxation Code, of any tax or any amount of tax required to be collected.
n. Citizens Oversight Committee. There shall be a five (5) person committee of members of the public to review and report on the revenue and expenditure of funds from the tax adopted by this chapter. Prior to the operative date, the city council shall adopt a resolution establishing the composition of the committee and defining the scope of its responsibilities. Also prior to the operative date, the city council shall appoint at least a quorum of the members of the committee; the city council shall complete the appointment of members of the committee by the end of fiscal year 2016.
o. Superseding Ordinance. Notwithstanding any other provision of the Lynwood Municipal Code, this section enacting a one percent (1.0%) transaction (sales) and use tax shall supersede any other conflicting code provisions and shall be the only city imposed transaction and use tax.
p. Expiration of Tax. The authority to levy the tax imposed by this section shall continue until terminated by action of the city council. (Ord. #1689, §1; Ord. #1732, §1)
6-2.10 Budget Stabilization Fund:
a. Title. This section shall be known as the city of Lynwood "Budget Stabilization Fund" Ordinance, which shall be either a subfund within the city’s general fund or in a separate fund (the "budget stabilization fund"). The city of Lynwood hereinafter shall be called "city." This section shall be applicable in the incorporated territory of the city.
b. Operative Date. Operative date means the first day of the first calendar quarter commencing more than one hundred ten (110) days after the adoption of the 2016 transactions and use tax ordinance.
c. Purpose. The budget stabilization fund shall be used to fund general city operations and activities that would otherwise be reduced in scope due to shortfalls in general fund structural revenues. For purposes of this subsection, the phrase general fund revenues means ongoing revenues which are available to fund ongoing general fund operations.
d. Transfers into and from the Budget Stabilization Fund.
1. Automatic Deposit of New General Tax Revenues into the Budget Stabilization Fund. The budget stabilization fund shall be funded by an automatic deposit/transfer of ten percent (10%) of general tax revenues generated each year by the 2016 transactions and use tax ordinance, commencing with fiscal year 2017. For purposes of this subsection, the phrase new general tax revenues means all revenues generated from the revenues from the transactions and use tax which was submitted to the voters concurrently with the ordinance codified in this section.
2. Discretionary Deposits into Budget Stabilization Fund Not Prohibited. Nothing in this chapter shall prohibit the city council, as part of the budgeting process, from contributing additional revenues to the budget stabilization fund, as determined in the city council’s sound legislative discretion.
3. Expenditures from the Budget Stabilization Fund. The city council may expend funds available from the budget stabilization fund in any single fiscal year if the city council declares a fiscal hardship by a four-fifths (4/5) vote, requiring the use of such resources to maintain current levels of city services and programs. For purposes of this section, a "fiscal hardship" may be deemed to occur whenever the city manager, in the proposed budget for a fiscal year, projects a level of general fund structural revenues that will result in a two percent (2%) or greater reduction in funding for general city services, as compared to the base budget that would be needed to maintain existing services. For purposes of this subsection, the phrase base budget means the projected on-going costs needed to maintain the same level of general fund operations as the prior fiscal year’s budget.
4. Maximum Balance for Budget Stabilization Fund. At no time shall the balance of the budget stabilization fund exceed ten percent (10%) of the city’s general fund structural revenues forecast in the adopted budget for the subsequent fiscal year. Automatic transfers of revenues into the budget stabilization fund as required by subsection 6-2.10d1 shall be made only to the extent that the fund balance does not exceed the ten percent (10%) threshold, as calculated above, and any automatic transfer that would result in such an excess balance shall be suspended. (Ord. #1690, §1)
Cross reference: Occupational licenses not to be issued if bank indebtedness exists for city sales tax, subsection 4-6.6.
State law reference: Uniform Local Sales and Use Tax Law, Rev. & Tax. Code, §7200 et seq.