TITLE
Recommendation to authorize City Manager to execute an agreement, and any amendments thereto, with the California State Board of Equalization (BOE), to facilitate the collection of revenue from local utility user taxes on prepaid mobile devices and any other local charges imposed on consumers of prepaid mobile devices; and
Adopt resolution authorizing MuniServices, LLC, to examine BOE records relating to such revenue and charges. (Citywide)
DISCUSSION
Assembly Bill (AB) 1717 establishes a uniform, statewide collection mechanism for prepaid (non-contract) wireless services by requiring California retail stores and online retailers to collect the local Utility Users Tax (UUT) when the sales tax is collected at the time of purchase. Under AB 1717, the UUT collections will be remitted to the BOE in the same manner as sales taxes; then, the BOE will distribute the revenue to cities and counties. Wireless carriers will now collect the UUT on their prepaid sales and remit the revenue directly to the City. For administrative ease, the different UUT rates charged throughout the state have been reduced to eight tiers. The new rate tier for prepaid wireless services in Long Beach will be 4.5 percent, and the City's existing UUT rate of 5 percent will continue to apply to postpaid, contract wireless customers and other utility services. If a local jurisdiction does not enter into a collection agreement with the BOE, any local charges imposed upon prepaid mobile telephone services will not be collected by the sellers and the local jurisdiction will not receive local charge revenue. AB 1717 requires that California retailers make the necessary changes to their sales systems to collect and remit state and local taxes beginning on January 1,2016.
The California Revenue and Taxation Code sets forth certain requirements for the disclosure of BOE records, and establishes criminal penalties for unlawful disclosure of this information. BOE requires the local legislative...
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