Sales and Use Tax Law: exemption: over-the-counter medication.

Plain English Breakdown

The official source material does not provide specific details about the requirements for reporting goals, purposes, objectives, detailed performance indicators, or data collection requirements. These were removed as they are not explicitly supported by the provided text.

Exemption from Sales Tax on Over-the-Counter Medication

AB-2522 exempts over-the-counter medication from state sales and use taxes in California until January 1, 2032.

What This Bill Does

• Removes state sales and use tax on the sale of over-the-counter medication from now until January 1, 2032.
• Specifies that local sales and use taxes will still apply to over-the-counter medications.

Who It Names or Affects

• Retailers selling over-the-counter medication in California
• Consumers buying over-the-counter medication in California

Terms To Know

Over-the-Counter Medication

Medicine that can be bought without a prescription from a doctor.

Sales and Use Tax

A tax charged on the sale or use of certain goods in California.

Limits and Unknowns

• The exemption does not apply to local sales taxes imposed by cities or counties.
• It also doesn't affect state sales taxes used for funding local government projects.

Official Summary Text

AB 2522, as introduced, Jeff Gonzalez.
Sales and Use Tax Law: exemption: over-the-counter medication.
Existing state 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. The Sales and Use Tax Law provides various exemptions from those taxes.
This bill would, until January 1, 2032, exempt from those taxes the gross receipts from the sale in this state of, and the storage, use, or other consumption in this state of, over-the-counter medication, as defined.
Existing law requires a bill authorizing a new tax expenditure to contain, among other things, specific goals, purposes, and objectives that the tax expenditure
will achieve, detailed performance indicators, and data collection requirements.
This bill would make findings detailing the goals of the above-described tax expenditure and performance indicators for determining whether the tax expenditure meets those goals.
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.
This bill would provide that the exemption created by this bill does not apply to local sales
and use taxes or transactions and use taxes.
Existing law imposes or dedicates certain state sales and use tax rates for local funding, including through the Local Revenue Fund 2011.
This bill would provide that the exemption created by this bill does not apply to those state sales and use tax rates imposed or dedicated for local government funding, including those rates for which revenues are deposited into the Local Revenue Fund 2011.
This bill would take effect immediately as a tax levy.

Current Bill Text

Download Bill PDF