Sales and use taxes: exemptions: nonprofit blood centers.
The passage of AB 2835 will not only alleviate the financial burden on nonprofit blood centers by exempting them from certain taxes but will also promote blood donation efforts by allowing these organizations to allocate more resources towards their mission. However, the bill stipulates that the state will not reimburse local agencies for any revenue losses incurred due to these exemptions, which may have implications for local budgets and services dependent on sales tax revenue.
Assembly Bill 2835, introduced by Assembly Member Fong, seeks to amend the Revenue and Taxation Code by adding Section 6364.6. This new section will exempt nonprofit organizations involved in blood donation from sales and use taxes on the purchase and use of tangible personal property necessary for their operations starting January 1, 2023. The bill aims to support organizations that recruit blood donors and provide related services, acknowledging their critical role in public health and safety.
Notable points of contention include the decision for the state not to reimburse local agencies for lost tax revenues, which some stakeholders argue could impact local government resources. Opponents may express concerns regarding the potential negative effects on local budgets, especially in areas where these tax revenues might be significant for funding public services. Furthermore, there might be discussions around whether similar tax exemptions should be extended to other nonprofit organizations operating in various sectors.