California Assembly Bill AB3198

California 2017-2018 Regular Session

• Introduced: 2/16/18

Caption

Sales and use taxes.

Impact

If enacted, AB 3198 will uphold certain exemptions for tangible personal property purchased by qualified individuals primarily engaged in teleproduction or postproduction activities. This includes machinery, equipment, and any associated tools necessary for the production of film or video content. The amendment aims to ensure that such essential items remain exempt from sales tax, thus supporting the film and media industry in California. However, the bill also clarifies restrictions regarding property that is used for administrative, general management, or marketing purposes, which do not qualify for exemption.

Summary

Assembly Bill No. 3198, introduced by Assembly Member Burke, aims to amend Section 6378 of the Revenue and Taxation Code in California. The bill addresses the existing exemptions under the Sales and Use Tax Law, specifically focused on the sale and use of tangible personal property intended for use in teleproduction and postproduction services. The bill makes nonsubstantive changes that clarify the types of property that qualify for this sales tax exemption. The intent of this amendment is to enhance the clarity of which items can be exempt and ensure the exemption appropriately serves its intended purpose.

Contention

The main points of contention surrounding AB 3198 may revolve around the definition of a 'qualified person' and the parameters of what constitutes 'teleproduction' or 'postproduction' services. Opponents may argue that the broad categorization could lead to misuse or abuse of the tax exemption, with entities outside the entertainment industry potentially taking advantage of the definition to evade tax liabilities. Furthermore, there could be other groups advocating for the removal of such exemptions entirely, arguing it diminishes tax revenues that could benefit public services.