Chapter 5.45
UTILITY USERS TAX
Sections:
5.45.010 Definitions.
5.45.020 Administration and enforcement.
5.45.030 Telephone users tax.
5.45.035 Exemptions.
5.45.040 Duty to collect.
5.45.050 Refusal to collect and report tax.
5.45.060 Delinquent taxes.
5.45.070 Actions to collect.
5.45.080 Refunds.
5.45.090 Records.
5.45.100 Appeal procedure.
5.45.110 Constitutional exemptions.
5.45.010 Definitions.
As used in this chapter:
Charges means the value of any other services, credits, property of every kind or nature, or other consideration provided by the service user in exchange for the telephone service. Charges shall not include:
1. Any tax imposed by the United States or by any charter city;
2. Amounts billed to nonsubscribers for coin shortages;
3. Amounts billed for any nonrecurring, installation, or service connection service charges; or
4. Amounts billed by a hotel or motel for service rendered in placing calls for its guests.
Intrastate telephone service means all telephone communications services or telephone services where the point or points of origin and the point or points of destination of the service are all located in this state.
Person means any domestic or foreign corporation, firm, association, syndicate, joint stock company, partnership of any kind, joint venture, club, Massachusetts business or common law trust, society or individual.
Service supplier means a person required to collect and remit a tax imposed by this chapter.
Service user means a person required to pay a tax imposed by this chapter.
Tax administrator means the finance director of the city.
Telephone communications services or telephone services refers to that service which provides access to a telephone system and the privilege of telephonic quality communication with substantially all persons having telephone stations which are part of such telephone system.
Telephone corporation shall have the same meaning as California Public Utilities Code section 234. (Ord. 813 § 1, 2006; Ord. 524 § 1, 1983; 1991 code § 4-6.1)
5.45.020 Administration and enforcement.
A. The tax administrator shall have the power and duty, and is directed to enforce, each and all of the provisions of this chapter.
B. The tax administrator shall have power to adopt rules and regulations not inconsistent with provisions of this chapter for the purpose of carrying out and enforcing the payment, collection and remittance of the taxes herein imposed. A copy of such rules and regulations shall be on file in the tax administrator’s office.
C. The tax administrator may make administrative agreements to vary the strict requirements of this chapter so that collection of any tax imposed herein may be made in conformance with the billing procedures of a particular service supplier so long as the agreements result in collection of the tax in conformance with the general purpose and scope of this chapter. A copy of each such agreement shall be on file in the tax administrator’s office. (Ord. 524 § 1, 1983; 1991 code § 4-6.2)
5.45.030 Telephone users tax.
A. Tax imposed. There is imposed a tax on the amounts paid for any intrastate telephone services by every person in the city using each service. The tax imposed by this section shall be at the rate of 1% of the charges made for such services and shall be paid by the person paying for such services. The telephone users tax is intended to, and does, apply to all charges billed to a telephone account having a situs in the city, irrespective of whether a particular communication service originates or terminates within the city.
B. Collection. The tax imposed by this section shall be collected from the service user by the person providing the intrastate telephone communication services, or the person receiving payment for such services. The amount of the tax collected in one month shall be remitted to the tax collector on or before the last day of the following month; or, at the option of the person required to collect and remit the tax, an estimated amount of tax collected, measured by the tax billed in the previous month, shall be remitted to the tax collector on or before the last day of each month. (Ord. 813 § 2, 2006; Ord. 524 § 1, 1983; 1991 code § 4-6.3)
5.45.035 Exemptions.
Notwithstanding the provisions of PHMC § 5.45.030, the tax imposed under this chapter shall not be imposed on any of the following:
A. Certain coin-operated service. Service paid for by inserting coins in coin-operated telephones available to the public with respect to local telephone service, or with respect to toll telephone service if the charge for such toll telephone service is less than 25 cents; except that where such coin-operated telephone service is furnished for a guaranteed amount, the amounts paid under such guarantee plus any fixed monthly or other periodic charge shall be subject to the tax.
B. News services. No tax shall be imposed, except with respect to local telephone service, on any payment received from any person for services used in the collection of news for the public press, or a news ticker service furnishing a general news service similar to that of the public press, or radio broadcasting, or in the dissemination of news through the public press, or a news ticker service furnishing a general news service similar to that of the public press, or by means of radio broadcasting, if the charge for such service is billed in writing to such person.
C. International organizations or Red Cross. No tax shall be imposed on any payment received for services furnished to an international organization, or to the American National Red Cross.
D. Servicemen in combat zone. No tax shall be imposed on any payment received for any toll telephone service which originates within a combat zone from a member of the Armed Forces of the United States performing service in such combat zone, provided a certificate, setting forth such facts as the secretary may by regulations prescribe, is furnished to the person receiving such payment.
E. Items otherwise taxed. Only one payment of tax under PHMC § 5.45.030 shall be required with respect to the tax on any service, notwithstanding the lines or stations of one or more persons are used in furnishing such service.
F. Common carriers and communications companies. No tax shall be imposed on the amount paid for any toll telephone service to the extent that the amount so paid is for use by a common carrier, telephone or telegraph company, or radio broadcasting station or network in the conduct of its business as such.
G. Installation charges. No tax shall be imposed on so much of any amount paid for the installation of any instrument, wire, pole, switchboard, apparatus, or equipment as is properly attributable to such installation.
H. Nonprofit hospitals. No tax shall be imposed on any amount paid by a nonprofit hospital for services furnished to such organization. For purposes of this subsection, the term “nonprofit hospital” means a hospital which is exempt from income tax under Internal Revenue Code section 501(a).
I. State and local governmental exemption. No tax shall be imposed on any payment received for services or facilities furnished to the government of any state, or any political subdivision thereof, or the District of Columbia.
J. Exemption for nonprofit educational organizations. No tax shall be imposed on any amount paid by a nonprofit educational organization for services or facilities furnished to such organization. For purposes of this subsection, the term “nonprofit educational organization” means an educational organization which is exempt from income tax under Internal Revenue Code section 501(a). The term also includes a school operated as an activity of an organization which is exempt from income tax under section 501(a), if the school normally maintains a regular faculty and curriculum and normally has a regularly enrolled body of pupils or students in attendance at the place where its educational activities are regularly carried on.
K. Life-line service. No tax shall be imposed on service users subscribing to the life-line service as set by the California Public Utilities Commission.
L. Land mobile or maritime mobile services. No tax shall be imposed on telephone communications services that are land mobile services or maritime mobile services as defined in Section 2.1 of Title 47 of the Code of Federal Regulations as the section existed on January 1, 1970.
M. Other service or equipment. Any type of service or equipment furnished by a service supplier subject to public utility regulation during any period in which the same or similar services or equipment are also available for sale or lease from persons other than a service supplier subject to public utility regulation. (Ord. 813 § 3, 2006)
5.45.040 Duty to collect.
The duty to collect and remit the taxes imposed by this chapter shall be performed as follows:
A. The tax shall be collected insofar as practicable at the same time as and along with the charges made in accordance with the regular billing practices of the service supplier. Where the amount paid by a service user to a service supplier is less than the full amount of the charge and tax which has accrued for the billing period, a proportionate share of both the charge and the tax shall be deemed to have been paid except in those cases where a service user pays the full amount of the charges but notifies the service supplier of his or her refusal to pay the tax imposed on the charges.
B. The duty to collect tax from a service user shall commence with the beginning of the first full regular billing period applicable to the service user where all charges normally included in such regular billing are subject to the provisions of this chapter. Where a person receives more than one billing, one or more being for different periods than another, the duty to collect shall arise separately for each billing period. (Ord. 524 § 1, 1983; 1991 code § 4-6.4)
5.45.050 Refusal to collect and report tax.
A. If any supplier shall refuse to make, within the time provided in this chapter, any report and remittance of the tax or any portion thereof required by this chapter, the tax administrator shall proceed in such manner as he or she may deem best to obtain facts and information on which to base his or her estimate of the tax due. As soon as the tax administrator shall procure such facts and information as he or she is able to obtain upon which to base the assessment of any tax imposed by this chapter and payable by any service supplier who has refused to make such report and remittance, he or she shall proceed to determine and assess against such service supplier the tax, interest and penalties provided for by this chapter.
B. In case such determination is made, the tax administrator shall give notice of the amount so assessed by serving it personally or by depositing it in the United States mail, postage prepaid, addressed to the service supplier so assessed at his or her last known place of address.
C. Such service supplier may, within 10 days after the serving or mailing of such notice, make application in writing to the tax administrator for a hearing on the amount assessed. If the application by the service supplier for a hearing is not made within the time prescribed, the tax, interest and penalties, if any, determined by the tax administrator shall become final and conclusive and immediately due and payable. If such an application is made, the tax administrator shall give not less than 10 days’ written notice in the manner prescribed herein to the service supplier to show cause at a time and place fixed in the notice why the amount specified herein should not be fixed for such tax, interest and penalties. At such hearing, the service supplier may appear and offer evidence why such specified tax, interest and penalties should not be so fixed.
D. After such hearing the tax administrator shall determine the proper tax to be remitted and shall thereafter give written notice to the service supplier in the manner prescribed above of such determination and the amount, if any, of the tax, interest and penalties. The amount determined to be due shall be payable after 15 days unless an appeal is taken as provided in PHMC § 5.45.100. (Ord. 524 § 1, 1983; 1991 code § 4-6.5)
5.45.060 Delinquent taxes.
A. Taxes collected from a service user which are not remitted to the tax administrator on or before the due dates provided in this chapter are delinquent.
1. Interest and penalties for delinquency in remittance of any tax collected and not remitted shall be assessed as follows:
a. Any service supplier who fails to remit any tax imposed by this chapter within 10 days after receipt or written notice from the city of such failure shall pay a penalty of 10% of the amount of the tax.
b. In addition to the penalties imposed in this subsection, any service supplier who fails to remit any tax imposed by this chapter shall pay interest at the rate of 1% per month, or fraction thereof, on the amount of the tax, exclusive of penalties, from the date on which the remittance first became delinquent until paid.
c. Every penalty imposed upon a service supplier, and such interest as accrues, under the provisions of subsection A.1.b of this section shall become a part of the tax required to be remitted.
B. The tax administrator may make an assessment for taxes not remitted by a person required to remit:
1. Whenever the tax administrator determines that a service user has deliberately withheld the amount of the tax owed by him or her from the amounts remitted to a person required to collect the tax, or that a service user has refused to pay the amount of the tax to such person, or whenever the tax administrator deems it in the best interest of the city, he or she may relieve such person of the obligation to collect taxes due under this chapter from certain named service users for specified billing periods.
2. The service supplier shall provide the city with amounts refused along with the names, addresses and reasons of the service users refusing to pay the tax imposed under provisions of this chapter.
3. The tax administrator shall notify the service user that he or she has assumed responsibility to collect the taxes due for the stated periods and demand payment for such taxes. The notice shall be served on the service user by handing it to him or her personally or by deposit of the notice in the United States mail, postage prepaid thereon, addressed to the service user at the address to which billing was made by the person required to collect the tax; or, should the service user have changed his or her address, to his or her last known address. If the service user fails to remit the tax to the tax administrator within 15 days from the date of the service of the notice upon him or her, which shall be the date of mailing if service is not accomplished in person, a penalty of 25% of the amount of the tax set forth in the notice shall be imposed, but not less than $5.00. The penalty shall become part of the tax herein required to be paid. (Ord. 524 § 1, 1983; 1991 code § 4-6.6)
5.45.070 Actions to collect.
Any tax required to be paid by a service user under the provisions of this chapter shall be deemed a debt owed by the service user to the city. Any such tax collected from a service user which has not been remitted to the tax administrator shall be deemed a debt owed to the city by the person required to collect and remit. Any person owing money to the city under the provisions of this chapter shall be liable to an action brought in the name of the city for the recovery of such amount. (Ord. 524 § 1, 1983; 1991 code § 4-6.7)
5.45.080 Refunds.
A. Whenever the amount of any tax has been overpaid or paid more than once or has been erroneously or illegally collected or received by the tax administrator under this chapter it may be refunded as provided in this section.
B. Notwithstanding the provisions of subsection A of this section, a service supplier may claim a refund or take as credit against taxes collected and remitted the amount overpaid, paid more than once, or erroneously or illegally collected or received when it is established that the service user from whom the tax has been collected did not owe the tax; provided, however, that neither a refund nor a credit shall be allowed unless the amount of the tax so collected has either been refunded to the service user or credited to charges subsequently payable by the service user to the person required to collect and remit. A service supplier that has collected any amount of tax in excess of the amount of the tax imposed by this chapter and actually due from a service user may refund such amount to the service user and claim credit for such overpayment against the amount of tax which is due upon any other monthly returns, providing such credit is claimed in a return dated not later than three years from the date of overpayment.
C. No refund shall be paid under the provisions of this section unless the claimant establishes his or her right thereto by written records showing entitlement thereto.
D. Notwithstanding other provisions of this section, whenever a service supplier, pursuant to an order of the California Public Utilities Commission or a court of competent jurisdiction, makes a refund to service users of charges for past utility services, the taxes paid pursuant to this chapter on the amount of such refunded service charges shall also be refunded to service users by the service supplier to the extent that the service supplier can claim credit for such refunded taxes against the amount of tax which is due upon any other monthly returns. In the event this chapter is repealed, amounts of any refundable taxes will be borne by the city. (Ord. 524 § 1, 1983; 1991 code § 4-6.8)
5.45.090 Records.
It shall be the duty of every person required to collect and remit to the city any tax imposed by this chapter to keep and preserve, for a period of three years, all records as may be necessary to determine the amount of such tax as he or she may have been liable for the collection of and remittance to the tax administrator, which records the tax administrator shall have the right to inspect at all reasonable times. (Ord. 524 § 1, 1983; 1991 code § 4-6.9)
5.45.100 Appeal procedure.
A. A person aggrieved by a decision of the tax administrator or of any other officer in the city made under this chapter may appeal from the decision to the city manager.
B. A person appealing a decision shall file written notice of the appeal with the city manager within 15 days after notice of the decision. The notice shall state the grounds relied upon for appeal.
C. The city manager shall set the hearing within 45 days from the date of the receipt of the notice of appeal, giving the appellant not less than 10 days’ notice in writing of the time and place of hearing.
D. The findings and determination of the city manager at the hearing are final and conclusive. Within three days after the findings and determinations are made, notice shall be sent to the appellant.
E. If no appeal is taken, the decision of the tax administrator or other officer is final and conclusive on expiration of the time fixed for appeal. (Ord. 846 § 4, 2010; Ord. 524 § 1, 1983; 1991 code § 4-6.10)
5.45.110 Constitutional exemptions.
Nothing in this chapter shall be construed as imposing a tax upon any person when imposition of such tax upon that person would be in violation of the Constitution of the United States or that of the State of California. (Ord. 524 § 1, 1983; 1991 code § 4-6.11)