Contributors to the Sales Tax Task Force are invited to enter this site for:
- Assembly Bill 1687 Update 27 August 2010
- On May 13th, 2010 members of the STTF and other key DMC representatives met with the BOE to discuss the audit inconsistencies taking place and to clarify other key questions regarding the taxability of some of the servicesprovided by DMCs.
- BOE Update 20 January 2010
- Legislation Update 11 June 2009
- Call to Action before Wednesday, 13 May 2009
- Efforts to continue to seek legislation 6 March 2009
- California Sales Tax Budget Update posted 20 February 2009
- Information about BOE letters regarding registration as resellers posted 12 February 2009
- Further updates about SB 700 which is now SB 1628. Links to the letters and addresses of legislators are below.
Update May 14, 2008
On Wednesday, May 14, 2008, SB 1628 went before the Senate Revenue & Taxation Committee and your California Sales Tax Task Force was present for that hearing to offer testimony and support. SB 1628 received unanimous approval at the Hearing and will now move to the Appropriations Committee for hearing at 10:30 AM on Monday, May 19th. This passage before the Revenue & Taxation Committee has given legitimacy to our issue and creates momentum moving forward. After the Appropriations Committee hearing, the Bill will go before the Senate Floor for vote and then move to the Assembly side of the Legislature where the Bill will need to pass their Revenue & Taxation Committee, the Appropriations Committee and finally a vote on the Assembly Floor before going to the Governor for signature, hopefully sometime prior to September 30, 2008. The Bill will become law on January 1, 2009 should we continue to be successful in our fight.
The Sales Tax Task Force was informed that the best way to insure the Bill would be placed on the agenda for the Tax & Revenue Committee hearing on May 14th was to strike the clause “declaratory of existing law” and replace it with a “no inference clause”. In essence, the change in language would eliminate the currently estimated lost revenue to the State and would not protect DMCs from the tax liability of previous years should SB 1628 be approved. If the Bill passes, it will protect DMCs from the date of passage forward. In order to keep SB 1628 moving forward, the Sales Tax Task Force felt it best to agree to the change for without it, the Bill most certainly would have gone into suspense (and died). There are options we are currently pursuing involving an appeal to the BOE to seek protection for the tax liability for previous years but we will cross that bridge when appropriate.
SB 1628 ALERT!!! - February 27, 2008
Due to the inability to move SB 700 forward in 2007, the bill has been reintroduced in 2008 and is now identified as SB 1628 (Ducheny). Senator Denise Moreno Ducheny remains the author of ADME's legislation. SB 1628 is co-authored by Senator Patricia Wiggins and more co-authors are expected to be added as the bill moves forward. Hearings of the Senate Tax & Revenue and will begin near the end of March. The bill will then move to the Senate Appropriations Committee and then to the Senate floor. The same steps will then be repeated in the Assembly before heading to the Governor for signature. This process should be completed by the end of August. If all goes as planned, SB 1628 would become law 90 days after the Governor's signature.
The Board of Equalization (BOE) has stated that they are holding off on any DMC audits until there is resolution on SB 1628.
We have come so far to date and are so close on our attempt to resolve the Sales Tax issue. We currently have a great momentum of bi-partisan support for SB 1628. To continue that momentum, we need all California DMCs to generate letters to the Senate Revenue and Taxation Committee members as well as Colin Grinnell and Mike Prosio (list attached) urging their support of SB 1628. Please mail a copy of the sample letter on your company letterhead to everyone on the attached list within the next week. Addresses and/or Fax numbers (when available) are provided for the recipients of this letter. The sample letter already lists Senator Jenny Oropeza. Simply change the date, address and salutation for each subsequent person on the master mailing list.
We are also asking all DMCs to continue to financially support the STTF. We need your donations immediately to get us through these next few months. Please send your checks to ADME and indicate that your donations are for the STTF.
December 2007 UPDATE!
On December 10, 2007, the STTF made a visit to Sacramento and had meetings with members of the State Board of Equalization and legislators regarding the status of SB 700. Our bill is still active and very viable with no apparent opposition. Our hope is that when the legislature reconvenes in early January 2008, our bill will proceed through the legislative process towards approval.
Some of you may have received a recent bulletin by the SBOE regarding the taxation of event planners, which included many areas that are similar to what we are currently fighting. This is only a newsletter article and not a mandate for DMCs. We are in touch with the SBOE to ensure that, until the fate of SB 700 is resolved, no further punitive action will be taken with any destination management company.
The Sales Tax Task Force continues to work with Senator Ducheny and her staff on SB 700 which will again be addressed when the Legislature reconvenes on January 7, 2008. A suspense hearing will happen soon after the Legislature reconvenes and SB 700 will then move to the Senate Appropriations Committee. Once approved there, it will move to the Senate Floor for a vote before moving to the Assembly Committees and the Assembly Floor for a vote. After clearing the Assembly, it will go back to the Senate for confirmation and on to the Governor for signature.
Members of the Task Force will be meeting with Senator Ducheny in Sacramento on December 10th to discuss strategies and meet with additional State Senators to rally support for SB 700. In addition, the Task force will be meeting with Betty Yee, Chairwoman of the Board of Equalization, to reiterate the need to hold the BOE staff at bay while SB 700 is still pending and gain any additional support available from Betty Yee.
We will continue to provide updates as activity resumes and as SB 700 moves forward.
Financial support is a continuing effort and we greatly appreciate any additional contributions to sustain the Sales Tax Task Force efforts. Contributions should be sent to ADME with a clear designation that the funds are intended for the Sales Tax Fund.
Senate Bill 700 (SB 700) went before the Senate Tax and Revenue Committee on Wednesday, May 8th and received unanimous support. The Sales Tax Task Force was in Sacramento to solicit support from the Senators on this committee and to address the committee members at the hearing. This step was a major victory in the first of several committee hearings SB 700 will go through. The Bill will now probably go before the Senate Appropriations Committee on Wednesday, May 21st or the following week and then move to the Senate Floor shortly thereafter.
Once SB 700 clears the Senate, it will be reviewed before the Assembly Tax & Revenue Committee and the Assembly Appropriations Committee before moving to a vote in the Assembly. More information will be communicated to you as we cross the next hurdles.
Sales Tax Task Force
Want to verify who your California State Senator is? Click here for more information.
The Senate Tax and Revenue Hearing on SB 700 scheduled for Wednesday, April 25th has been postponed due to an abundance of bills on the legislative calendar. The Hearing has been rescheduled for Wednesday, May 9th at 1:30 pm in Room 3191 of the State Capitol Building.
We encourage those DMCs who planned to attend the April 25th hearing in Sacramento as a show of support for SB 700 to please consider doing so again on May 9th. We encourage and welcome the support of anyone who can join us in Sacramento on May 9th at 1:30pm.
Senate Bill 700 (SB 700) was introduced to the California legislature on February 23, 2007. The current language is intent language and acts as an initial placeholder on the legislative calendar. The language of the Bill will be further modified and refined over the course of the next few months to define Destinations Management Companies (DMCs) as consumers rather than resellers under the Sales and Use Tax Law. The bill will go before Senate hearings in early April.
If your state is pursuing the classification of DMCs as resellers, similar to California, please contact the ADME Sales Tax Task Force for additional information on how you can take up this fight in your part of the country.
We will keep this website updated with the progress of the SB 700. Sales Tax Task Force contributors may enter this site and see the full version of SB 700.
Sales Tax Task Force
GENERAL DESCRIPTION OF ISSUE
Several states have started aggressive initiatives designed to reclassify DMCs as resellers which would result in the collection of sales tax, including back taxes, penalties, and interest. The California State Board of Equalization (SBOE) recently concluded a broad-scale amnesty program for suspected sales tax violators. The SBOE asserts that DMCs may be required to obtain a seller's permit. Unpaid taxes, plus interest and penalties are being assessed going back as far as 10 years.
Concerned DMCs have joined together to form a Task Force to challenge this initiative and avoid overall industry reclassification as resellers. The Task Force has been formed under the umbrella of ADME, and legal counsel has been retained to challenge this initiative.
Critical information, as well as the ongoing progress of the Task Force will be available on this website for those companies who have provided financial support. A password to gain access to information will be provided to those companies who meet the following requirements:
- Current Membership to ADME
- Contribution of $1,000 per office location to the Task Force Fund
How to access for the first time - Back to top
- Click on the Forgot your Password? link
- Enter your e-mail address (use the one that you’ve given ADME for your membership records, please!)
- Click Submit
- A randomly generated password will be e-mailed to you immediately
- Use that password to enter the first time
- Once you on the protected page, you have the option to change your password