The legislation seeks to enhance state oversight and collection of taxes on aviation fuel, with provisions for gathering comprehensive data on fuel sales and associated tax revenues. By mandating the reporting of specific sales information, the bill enables the California Department of Tax and Fee Administration to accurately calculate the state's revenue from aviation fuel, contributing to local tax entities' financial planning and compliance with federal aviation guidelines. This approach is expected to streamline the reporting process and improve revenue predictability for state and local governments.
Summary
Senate Bill 988, introduced by Senator McGuire, aims to amend sections of the Revenue and Taxation Code related to the taxation and reporting of aviation fuel. This bill establishes a requirement for aviation fuel retailers to submit a quarterly information return detailing sales data and compliance with federal regulations. Notably, it imposes a $5,000 penalty for those who fail to file or provide inaccurate information, while allowing exemptions in cases where failure is due to reasonable causes beyond the retailer's control.
Contention
However, concerns have been raised regarding the imposition of strict penalties, which some stakeholders fear could disproportionately affect smaller retailers that may struggle with compliance. The $5,000 penalty for non-compliance or inaccurate reporting might pose an unnecessary financial burden, particularly for businesses already operating on tight margins. Legislative debates surrounding this bill will likely weigh the potential financial benefits of improved tax reporting against the implications of added regulatory burdens on aviation fuel retailers.