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ARTICLE 13 TAXATION
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SEC. 1. Unless otherwise provided by this Constitution or the laws
of the United States:
(a) All property is taxable and shall be assessed at the same
percentage of fair market value. When a value standard other than
fair market value is prescribed by this Constitution or by statute
authorized by this Constitution, the same percentage shall be applied
to determine the assessed value. The value to which the percentage
is applied, whether it be the fair market value or not, shall be
known for property tax purposes as the full value.
(b) All property so assessed shall be taxed in proportion to its
full value.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 2. The Legislature may provide for property taxation of all
forms of tangible personal property, shares of capital stock,
evidences of indebtedness, and any legal or equitable interest
therein not exempt under any other provision of this article. The
Legislature, two-thirds of the membership of each house concurring,
may classify such personal property for differential taxation or for
exemption. The tax on any interest in notes, debentures, shares of
capital stock, bonds, solvent credits, deeds of trust, or mortgages
shall not exceed four-tenths of one percent of full value, and the
tax per dollar of full value shall not be higher on personal property
than on real property in the same taxing jurisdiction.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 3. The following are exempt from property taxation:
(a) Property owned by the State.
(b) Property owned by a local government, except as otherwise
provided in Section 11(a).
(c) Bonds issued by the State or a local government in the State.
(d) Property used for libraries and museums that are free and open
to the public and property used exclusively for public schools,
community colleges, state colleges, and state universities.
(e) Buildings, land, equipment, and securities used exclusively
for educational purposes by a nonprofit institution of higher
education.
(f) Buildings, land on which they are situated, and equipment used
exclusively for religious worship.
(g) Property used or held exclusively for the permanent deposit of
human dead or for the care and maintenance of the property or the
dead, except when used or held for profit. This property is also
exempt from special assessment.
(h) Growing crops.
(i) Fruit and nut trees until 4 years after the season in which
they were planted in orchard form and grape vines until 3 years after
the season in which they were planted in vineyard form.
(j) Immature forest trees planted on lands not previously bearing
merchantable timber or planted or of natural growth on lands from
which the merchantable original growth timber stand to the extent of
70 percent of all trees over 16 inches in diameter has been removed.
Forest trees or timber shall be considered mature at such time after
40 years from the time of planting or removal of the original timber
when so declared by a majority vote of a board consisting of a
representative from the State Board of Forestry, a representative
from the State Board of Equalization, and the assessor of the county
in which the trees are located.
The Legislature may supersede the foregoing provisions with an
alternative system or systems of taxing or exempting forest trees or
timber, including a taxation system not based on property valuation.
Any alternative system or systems shall provide for exemption of
unharvested immature trees, shall encourage the continued use of
timberlands for the production of trees for timber products, and
shall provide for restricting the use of timberland to the production
of timber products and compatible uses with provisions for taxation
of timberland based on the restrictions. Nothing in this paragraph
shall be construed to exclude timberland from the provisions of
Section 8 of this article.
(k) $7,000 of the full value of a dwelling, as defined by the
Legislature, when occupied by an owner as his principal residence,
unless the dwelling is receiving another real property exemption.
The Legislature may increase this exemption and may deny it if the
owner received state or local aid to pay taxes either in whole or in
part, and either directly or indirectly, on the dwelling.
No increase in this exemption above the amount of $7,000 shall be
effective for any fiscal year unless the Legislature increases the
rate of state taxes in an amount sufficient to provide the
subventions required by Section 25.
If the Legislature increases the homeowners' property tax
exemption, it shall provide increases in benefits to qualified
renters, as defined by law, comparable to the average increase in
benefits to homeowners, as calculated by the Legislature.
(l) Vessels of more than 50 tons burden in this State and engaged
in the transportation of freight or passengers.
(m) Household furnishings and personal effects not held or used in
connection with a trade, profession, or business.
(n) Any debt secured by land.
(o) Property in the amount of $1,000 of a claimant who--
(1) is serving in or has served in and has been discharged under
honorable conditions from service in the United States Army, Navy,
Air Force, Marine Corps, Coast Guard, or Revenue Marine (Revenue
Cutter) Service; and--
(2) served either
(i) in time of war, or
(ii) in time of peace in a campaign or expedition for which a
medal has been issued by Congress, or
(iii) in time of peace and because of a service-connected
disability was released from active duty; and--
(3) resides in the State on the current lien date.
An unmarried person who owns property valued at $5,000 or more, or
a married person, who, together with the spouse, owns property
valued at $10,000 or more, is ineligible for this exemption.
If the claimant is married and does not own property eligible for
the full amount of the exemption, property of the spouse shall be
eligible for the unused balance of the exemption.
(p) Property in the amount of $1,000 of a claimant who--
(1) is the unmarried spouse of a deceased veteran who met the
service requirement stated in paragraphs (1) and (2) of subsection 3
(o), and
(2) does not own property in excess of $10,000, and
(3) is a resident of the State on the current lien date.
(q) Property in the amount of $1,000 of a claimant who--
(1) is the parent of a deceased veteran who met the service
requirement stated in paragraphs (1) and (2) of subsection 3(o), and
(2) receives a pension because of the veteran's service, and
(3) is a resident of the State on the current lien date.
Either parent of a deceased veteran may claim this exemption.
An unmarried person who owns property valued at $5,000 or more, or
a married person, who, together with the spouse, owns property
valued at $10,000 or more, is ineligible for this exemption.
(r) No individual residing in the State on the effective date of
this amendment who would have been eligible for the exemption
provided by the previous section 11/4 of this article had it not been
repealed shall lose eligibility for the exemption as a result of
this amendment.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 3.5. In any year in which the assessment ratio is changed, the
Legislature shall adjust the valuation of assessable property
described in subdivisions (o), (p) and (q) of Section 3 of this
article to maintain the same proportionate values of such property.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 4. The Legislature may exempt from property taxation in whole
or in part:
(a) The home of a person or a person's spouse, including an
unmarried surviving spouse, if the person, because of injury incurred
in military service, is blind in both eyes, has lost the use of 2 or
more limbs, or is totally disabled, or if the person has, as a
result of a service-connected injury or disease, died while on active
duty in military service, unless the home is receiving another real
property exemption.
(b) Property used exclusively for religious, hospital, or
charitable purposes and owned or held in trust by corporations or
other entities (1) that are organized and operating for those
purposes, (2) that are nonprofit, and (3) no part of whose net
earnings inures to the benefit of any private shareholder or
individual.
(c) Property owned by the California School of Mechanical Arts,
California Academy of Sciences, or Cogswell Polytechnical College, or
held in trust for the Huntington Library and Art Gallery, or their
successors.
(d) Real property not used for commercial purposes that is
reasonably and necessarily required for parking vehicles of persons
worshipping on land exempt by Section 3(f).
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 5. Exemptions granted or authorized by Sections 3(e), 3(f),
and 4(b) apply to buildings under construction, land required for
their convenient use, and equipment in them if the intended use would
qualify the property for exemption.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 6. The failure in any year to claim, in a manner required by
the laws in effect at the time the claim is required to be made, an
exemption or classification which reduces a property tax shall be
deemed a waiver of the exemption or classification for that year.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 7. The Legislature, two-thirds of the membership of each house
concurring, may authorize county boards of supervisors to exempt
real property having a full value so low that, if not exempt, the
total taxes and applicable subventions on the property would amount
to less than the cost of assessing and collecting them.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 8. To promote the conservation, preservation and continued
existence of open space lands, the Legislature may define open space
land and shall provide that when this land is enforceably restricted,
in a manner specified by the Legislature, to recreation, enjoyment
of scenic beauty, use or conservation of natural resources, or
production of food or fiber, it shall be valued for property tax
purposes only on a basis that is consistent with its restrictions and
uses.
To promote the preservation of property of historical
significance, the Legislature may define such property and shall
provide that when it is enforceably restricted, in a manner specified
by the Legislature, it shall be valued for property tax purposes
only on a basis that is consistent with its restrictions and uses.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 8.5. The Legislature may provide by law for the manner in
which a person of low or moderate income who is 62 years of age or
older may postpone ad valorem property taxes on the dwelling owned
and occupied by him or her as his or her principal place of
residence. The Legislature may also provide by law for the manner in
which a disabled person may postpone payment of ad valorem property
taxes on the dwelling owned and occupied by him or her as his or her
principal place of residence. The Legislature shall have plenary
power to define all terms in this section.
The Legislature shall provide by law for subventions to counties,
cities and counties, cities and districts in an amount equal to the
amount of revenue lost by each by reason of the postponement of taxes
and for the reimbursement to the State of subventions from the
payment of postponed taxes. Provision shall be made for the
inclusion of reimbursement for the payment of interest on, and any
costs to the State incurred in connection with, the subventions.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 9. The Legislature may provide for the assessment for taxation
only on the basis of use of a single-family dwelling, as defined by
the Legislature, and so much of the land as is required for its
convenient use and occupation, when the dwelling is occupied by an
owner and located on land zoned exclusively for single-family
dwellings or for agricultural purposes.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 10. Real property in a parcel of 10 or more acres which, on
the lien date and for 2 or more years immediately preceding, has been
used exclusively for nonprofit golf course purposes shall be
assessed for taxation on the basis of such use, plus any value
attributable to mines, quarries, hydrocarbon substances, or other
minerals in the property or the right to extract hydrocarbons or
other minerals from the property.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 11. (a) Lands owned by a local government that are outside its
boundaries, including rights to use or divert water from surface or
underground sources and any other interests in lands, are taxable if
(1) they are located in Inyo or Mono County and (a) they were
assessed for taxation to the local government in Inyo County as of
the 1966 lien date, or in Mono County as of the 1967 lien date,
whether or not the assessment was valid when made, or (b) they were
acquired by the local government subsequent to that lien date and
were assessed to a prior owner as of that lien date and each lien
date thereafter, or (2) they are located outside Inyo or Mono County
and were taxable when acquired by the local government. Improvements
owned by a local government that are outside its boundaries are
taxable if they were taxable when acquired or were constructed by the
local government to replace improvements which were taxable when
acquired.
(b) Taxable land belonging to a local government and located in
Inyo County shall be assessed in any year subsequent to 1968 at the
place where it was assessed as of the 1966 lien date and in an amount
derived by multiplying its 1966 assessed value by the ratio of the
statewide per capita assessed value of land as of the last lien date
prior to the current lien date to $766, using civilian population
only. Taxable land belonging to a local government and located in
Mono County shall be assessed in any year subsequent to 1968 at the
place where it was assessed as of the 1967 lien date and in an amount
determined by the preceding formula except that the 1967 lien date,
the 1967 assessed value, and the figure $856 shall be used in the
formula. Taxable land belonging to a local government and located
outside of Inyo and Mono counties shall be assessed at the place
where located and in an amount that does not exceed the lower of (1)
its fair market value times the prevailing percentage of fair market
value at which other lands are assessed and (2) a figure derived in
the manner specified in this Section for land located in Mono County.
If land acquired by a local government after the lien date of the
base year specified in this Section was assessed in the base year as
part of a larger parcel, the assessed value of the part in the base
year shall be that fraction of the assessed value of the larger
parcel that the area of the part is of the area of the larger parcel.
If a local government divests itself of ownership of land without
water rights and this land was assessed in Inyo County as of the 1966
lien date or in Mono County as of the 1967 lien date, the divestment
shall not diminish the quantity of water rights assessable and
taxable at the place where assessed as of that lien date.
(c) In the event the Legislature changes the prevailing percentage
of fair market value at which land is assessed for taxation, there
shall be used in the computations required by Section 11(b) of this
Article, for the first year for which the new percentage is
applicable, in lieu of the statewide per capita assessed value of
land as of the last lien date prior to the current lien date, the
statewide per capita assessed value of land on the prior lien date
times the ratio of the new prevailing percentage of fair market value
to the previous prevailing percentage.
(d) If, after March 1954, a taxable improvement is replaced while
owned by and in possession of a local government, the replacement
improvement shall be assessed, as long as it is owned by a local
government, as other improvements are except that the assessed value
shall not exceed the product of (1) the percentage at which privately
owned improvements are assessed times (2) the highest full value
ever used for taxation of the improvement that has been replaced.
For purposes of this calculation, the full value for any year prior
to 1967 shall be conclusively presumed to be 4 times the assessed
value in that year.
(e) No tax, charge, assessment, or levy of any character, other
than those taxes authorized by Sections 11(a) to 11(d), inclusive, of
this Article, shall be imposed upon one local government by another
local government that is based or calculated upon the consumption or
use of water outside the boundaries of the government imposing it.
(f) Any taxable interest of any character, other than a lease for
agricultural purposes and an interest of a local government, in any
land owned by a local government that is subject to taxation pursuant
to Section 11(a) of this Article shall be taxed in the same manner
as other taxable interests. The aggregate value of all the interests
subject to taxation pursuant to Section 11(a), however, shall not
exceed the value of all interests in the land less the taxable value
of the interest of any local government ascertained as provided in
Sections 11(a) to 11(e), inclusive, of this Article.
(g) Any assessment made pursuant to Section 11(a) to 11(d),
inclusive, of this Article shall be subject to review, equalization,
and adjustment by the State Board of Equalization, but an adjustment
shall conform to the provisions of these Sections.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 12. (a) Except as provided in subdivision (b), taxes on
personal property, possessory interest in land, and taxable
improvements located on land exempt from taxation which are not a
lien upon land sufficient in value to secure their payment shall be
levied at the rates for the preceding tax year upon property of the
same kind where the taxes were a lien upon land sufficient in value
to secure their payment.
(b) In any year in which the assessment ratio is changed, the
Legislature shall adjust the rate described in subdivision (a) to
maintain equality between property on the secured and unsecured
rolls.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 13. Land and improvements shall be separately assessed.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 14. All property taxed by local government shall be assessed
in the county, city, and district in which it is situated.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 15. The Legislature may authorize local government to provide
for the assessment or reassessment of taxable property physically
damaged or destroyed after the lien date to which the assessment or
reassessment relates.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 16. The county board of supervisors, or one or more assessment
appeals boards created by the county board of supervisors, shall
constitute the county board of equalization for a county. Two or
more county boards of supervisors may jointly create one or more
assessment appeals boards which shall constitute the county board of
equalization for each of the participating counties.
Except as provided in subdivision (g) of Section 11, the county
board of equalization, under such rules of notice as the county board
may prescribe, shall equalize the values of all property on the
local assessment roll by adjusting individual assessments.
County boards of supervisors shall fix the compensation for
members of assessment appeals boards, furnish clerical and other
assistance for those boards, adopt rules of notice and procedures for
those boards as may be required to facilitate their work and to
insure uniformity in the processing and decision of equalization
petitions, and may provide for their discontinuance.
The Legislature shall provide for: (a) the number and
qualifications of members of assessment appeals boards, the manner of
selecting, appointing, and removing them, and the terms for which
they serve, and (b) the procedure by which two or more county boards
of supervisors may jointly create one or more assessment appeals
boards.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 17. The Board of Equalization consists of 5 voting members:
the Controller and 4 members elected for 4-year terms at
gubernatorial elections. The State shall be divided into four Board
of Equalization districts with the voters of each district electing
one member. No member may serve more than 2 terms.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 18. The Board shall measure county assessment levels annually
and shall bring those levels into conformity by adjusting entire
secured local assessment rolls. In the event a property tax is
levied by the State, however, the effects of unequalized local
assessment levels, to the extent any remain after such adjustments,
shall be corrected for purposes of distributing this tax by
equalizing the assessment levels of locally and state-assessed
properties and varying the rate of the state tax inversely with the
counties' respective assessment levels.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 19. The Board shall annually assess (1) pipelines, flumes,
canals, ditches, and aqueducts lying within 2 or more counties and
(2) property, except franchises, owned or used by regulated railway,
telegraph, or telephone companies, car companies operating on
railways in the State, and companies transmitting or selling gas or
electricity. This property shall be subject to taxation to the same
extent and in the same manner as other property.
No other tax or license charge may be imposed on these companies
which differs from that imposed on mercantile, manufacturing, and
other business corporations. This restriction does not release a
utility company from payments agreed on or required by law for a
special privilege or franchise granted by a government body.
The Legislature may authorize Board assessment of property owned
or used by other public utilities.
The Board may delegate to a local assessor the duty to assess a
property used but not owned by a state assessee on which the taxes
are to be paid by a local assessee.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 20. The Legislature may provide maximum property tax rates and
bonding limits for local governments.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 21. Within such limits as may be provided under Section 20 of
this Article, the Legislature shall provide for an annual levy by
county governing bodies of school district taxes sufficient to
produce annual revenues for each district that the district's board
determines are required for its schools and district functions.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 22. Not more than 25 percent of the total appropriations from
all funds of the State shall be raised by means of taxes on real and
personal property according to the value thereof.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 23. If state boundaries change, the Legislature shall
determine how property affected shall be taxed.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 24. The Legislature may not impose taxes for local purposes
but may authorize local governments to impose them.
Money appropriated from state funds to a local government for its
local purposes may be used as provided by law.
Money subvened to a local government under Section 25 may be used
for state or local purposes.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 25. The Legislature shall provide, in the same fiscal year,
reimbursements to each local government for revenue lost because of
Section 3(k).
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 25.5. (a) On or after November 3, 2004, the Legislature shall
not enact a statute to do any of the following:
(1) (A) Except as otherwise provided in subparagraph (B), modify
the manner in which ad valorem property tax revenues are allocated in
accordance with subdivision (a) of Section 1 of Article XIIIA so as
to reduce for any fiscal year the percentage of the total amount of
ad valorem property tax revenues in a county that is allocated among
all of the local agencies in that county below the percentage of the
total amount of those revenues that would be allocated among those
agencies for the same fiscal year under the statutes in effect on
November 3, 2004. For purposes of this subparagraph, "percentage"
does not include any property tax revenues referenced in paragraph
(2).
(B) Beginning with the 2008-09 fiscal year and except as otherwise
provided in subparagraph (C), subparagraph (A) may be suspended for
a fiscal year if all of the following conditions are met:
(i) The Governor issues a proclamation that declares that, due to
a severe state fiscal hardship, the suspension of subparagraph (A) is
necessary.
(ii) The Legislature enacts an urgency statute, pursuant to a bill
passed in each house of the Legislature by rollcall vote entered in
the journal, two-thirds of the membership concurring, that contains a
suspension of subparagraph (A) for that fiscal year and does not
contain any other provision.
(iii) No later than the effective date of the statute described in
clause (ii), a statute is enacted that provides for the full
repayment to local agencies of the total amount of revenue losses,
including interest as provided by law, resulting from the
modification of ad valorem property tax revenue allocations to local
agencies. This full repayment shall be made not later than the end
of the third fiscal year immediately following the fiscal year to
which the modification applies.
(C) (i) Subparagraph (A) shall not be suspended for more than two
fiscal years during any period of 10 consecutive fiscal years, which
period begins with the first fiscal year for which subparagraph (A)
is suspended.
(ii) Subparagraph (A) shall not be suspended during any fiscal
year if the full repayment required by a statute enacted in
accordance with clause (iii) of subparagraph (B) has not yet been
completed.
(iii) Subparagraph (A) shall not be suspended during any fiscal
year if the amount that was required to be paid to cities, counties,
and cities and counties under Section 10754.11 of the Revenue and
Taxation Code, as that section read on November 3, 2004, has not been
paid in full prior to the effective date of the statute providing
for that suspension as described in clause (ii) of subparagraph (B).
(iv) A suspension of subparagraph (A) shall not result in a total
ad valorem property tax revenue loss to all local agencies within a
county that exceeds 8 percent of the total amount of ad valorem
property tax revenues that were allocated among all local agencies
within that county for the fiscal year immediately preceding the
fiscal year for which subparagraph (A) is suspended.
(2) (A) Except as otherwise provided in subparagraphs (B) and (C),
restrict the authority of a city, county, or city and county to
impose a tax rate under, or change the method of distributing
revenues derived under, the Bradley-Burns Uniform Local Sales and Use
Tax Law set forth in Part 1.5 (commencing with Section 7200) of
Division 2 of the Revenue and Taxation Code, as that law read on
November 3, 2004. The restriction imposed by this subparagraph also
applies to the entitlement of a city, county, or city and county to
the change in tax rate resulting from the end of the revenue exchange
period, as defined in Section 7203.1 of the Revenue and Taxation
Code as that section read on November 3, 2004.
(B) The Legislature may change by statute the method of
distributing the revenues derived under a use tax imposed pursuant to
the Bradley-Burns Uniform Local Sales and Use Tax Law to allow the
State to participate in an interstate compact or to comply with
federal law.
(C) The Legislature may authorize by statute two or more
specifically identified local agencies within a county, with the
approval of the governing body of each of those agencies, to enter
into a contract to exchange allocations of ad valorem property tax
revenues for revenues derived from a tax rate imposed under the
Bradley-Burns Uniform Local Sales and Use Tax Law. The exchange under
this subparagraph of revenues derived from a tax rate imposed under
that law shall not require voter approval for the continued
imposition of any portion of an existing tax rate from which those
revenues are derived.
(3) Except as otherwise provided in subparagraph (C) of paragraph
(2), change for any fiscal year the pro rata shares in which ad
valorem property tax revenues are allocated among local agencies in a
county other than pursuant to a bill passed in each house of the
Legislature by rollcall vote entered in the journal, two-thirds of
the membership concurring.
(4) Extend beyond the revenue exchange period, as defined in
Section 7203.1 of the Revenue and Taxation Code as that section read
on November 3, 2004, the suspension of the authority, set forth in
that section on that date, of a city, county, or city and county to
impose a sales and use tax rate under the Bradley-Burns Uniform Local
Sales and Use Tax Law.
(5) Reduce, during any period in which the rate authority
suspension described in paragraph (4) is operative, the payments to a
city, county, or city and county that are required by Section 97.68
of the Revenue and Taxation Code, as that section read on November 3,
2004.
(6) Restrict the authority of a local entity to impose a
transactions and use tax rate in accordance with the Transactions and
Use Tax Law (Part 1.6 (commencing with Section 7251) of Division 2
of the Revenue and Taxation Code), or change the method for
distributing revenues derived under a transaction and use tax rate
imposed under that law, as it read on November 3, 2004.
(b) For purposes of this section, the following definitions apply:
(1) "Ad valorem property tax revenues" means all revenues derived
from the tax collected by a county under subdivision (a) of Section 1
of Article XIIIA, regardless of any of this revenue being otherwise
classified by statute.
(2) "Local agency" has the same meaning as specified in Section 95
of the Revenue and Taxation Code as that section read on November 3,
2004.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 26. (a) Taxes on or measured by income may be imposed on
persons, corporations, or other entities as prescribed by law.
(b) Interest on bonds issued by the State or a local government in
the State is exempt from taxes on income.
(c) Income of a nonprofit educational institution of collegiate
grade within the State of California is exempt from taxes on or
measured by income if both of the following conditions are met:
(1) The income is not unrelated business income as defined by the
Legislature.
(2) The income is used exclusively for educational purposes.
(d) A nonprofit organization that is exempted from taxation by
Chapter 4 (commencing with Section 23701) of Part 11 of Division 2 of
the Revenue and Taxation Code or Subchapter F (commencing with
Section 501) of Chapter 1 of Subtitle A of the Internal Revenue Code
of 1986, or the successor of either, is exempt from any business
license tax or fee measured by income or gross receipts that is
levied by a county or city, whether charter or general law, a city
and county, a school district, a special district, or any other local
agency.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 27. The Legislature, a majority of the membership of each
house concurring, may tax corporations, including state and national
banks, and their franchises by any method not prohibited by this
Constitution or the Constitution or laws of the United States.
Unless otherwise provided by the Legislature, the tax on state and
national banks shall be according to or measured by their net income
and shall be in lieu of all other taxes and license fees upon banks
or their shares, except taxes upon real property and vehicle
registration and license fees.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 28. (a) "Insurer," as used in this section, includes insurance
companies or associations and reciprocal or interinsurance exchanges
together with their corporate or other attorneys in fact considered
as a single unit, and the State Compensation Insurance Fund. As used
in this paragraph, "companies" includes persons, partnerships, joint
stock associations, companies and corporations.
(b) An annual tax is hereby imposed on each insurer doing business
in this State on the base, at the rates, and subject to the
deductions from the tax hereinafter specified.
(c) In the case of an insurer not transacting title insurance in
this State, the "basis of the annual tax" is, in respect to each
year, the amount of gross premiums, less return premiums, received in
such year by such insurer upon its business done in this State,
other than premiums received for reinsurance and for ocean marine
insurance.
In the case of an insurer transacting title insurance in this
State, the "basis of the annual tax" is, in respect to each year, all
income upon business done in this State, except:
(1) Interest and dividends.
(2) Rents from real property.
(3) Profits from the sale or other disposition of investments.
(4) Income from investments.
"Investments" as used in this subdivision includes property
acquired by such insurer in the settlement or adjustment of claims
against it but excludes investments in title plants and title
records. Income derived directly or indirectly from the use of title
plants and title records is included in the basis of the annual tax.
In the case of an insurer transacting title insurance in this
State which has a trust department and does a trust business under
the banking laws of this State, there shall be excluded from the
basis of the annual tax imposed by this section, the income of, and
from the assets of, such trust department and such trust business, if
such income is taxed by this State or included in the measure of any
tax imposed by this State.
(d) The rate of the tax to be applied to the basis of the annual
tax in respect to each year is 2.35 percent.
(f) The tax imposed on insurers by this section is in lieu of all
other taxes and licenses, state, county, and municipal, upon such
insurers and their property, except:
(1) Taxes upon their real estate.
(2) That an insurer transacting title insurance in this State
which has a trust department or does a trust business under the
banking laws of this State is subject to taxation with respect to
such trust department or trust business to the same extent and in the
same manner as trust companies and the trust departments of banks
doing business in this State.
(3) When by or pursuant to the laws of any other state or foreign
country any taxes, licenses and other fees, in the aggregate, and any
fines, penalties, deposit requirements or other material
obligations, prohibitions or restrictions are or would be imposed
upon California insurers, or upon the agents or representatives of
such insurers, which are in excess of such taxes, licenses and other
fees, in the aggregate, or which are in excess of the fines,
penalties, deposit requirements or other obligations, prohibitions,
or restrictions directly imposed upon similar insurers, or upon the
agents or representatives of such insurers, of such other state or
country under the statutes of this State; so long as such laws of
such other state or country continue in force or are so applied, the
same taxes, licenses and other fees, in the aggregate, or fines,
penalties or deposit requirements or other material obligations,
prohibitions, or restrictions, of whatever kind shall be imposed upon
the insurers, or upon the agents or representatives of such
insurers, of such other state or country doing business or seeking to
do business in California. Any tax, license or other fee or other
obligation imposed by any city, county, or other political
subdivision or agency of such other state or country on California
insurers or their agents or representatives shall be deemed to be
imposed by such state or country within the meaning of this paragraph
(3) of subdivision (f).
The provisions of this paragraph (3) of subdivision (f) shall not
apply as to personal income taxes, nor as to ad valorem taxes on real
or personal property nor as to special purpose obligations or
assessments heretofore imposed by another state or foreign country in
connection with particular kinds of insurance, other than property
insurance; except that deductions, from premium taxes or other taxes
otherwise payable, allowed on account of real estate or personal
property taxes paid shall be taken into consideration in determining
the propriety and extent of retaliatory action under this paragraph
(3) of subdivision (f).
For the purposes of this paragraph (3) of subdivision (f) the
domicile of an alien insurer, other than insurers formed under the
laws of Canada, shall be that state in which is located its principal
place of business in the United States.
In the case of an insurer formed under the laws of Canada or a
province thereof, its domicile shall be deemed to be that province in
which its head office is situated.
The provisions of this paragraph (3) of subdivision (f) shall also
be applicable to reciprocals or interinsurance exchanges and
fraternal benefit societies.
(4) The tax on ocean marine insurance.
(5) Motor vehicle and other vehicle registration license fees and
any other tax or license fee imposed by the State upon vehicles,
motor vehicles or the operation thereof.
(6) That each corporate or other attorney in fact of a reciprocal
or interinsurance exchange shall be subject to all taxes imposed upon
corporations or others doing business in the State, other than taxes
on income derived from its principal business as attorney in fact.
A corporate or other attorney in fact of each exchange shall
annually compute the amount of tax that would be payable by it under
prevailing law except for the provisions of this section, and any
management fee due from each exchange to its corporate or other
attorney in fact shall be reduced pro tanto by a sum equivalent to
the amount so computed.
(g) Every insurer transacting the business of ocean marine
insurance in this State shall annually pay to the State a tax
measured by that proportion of the underwriting profit of such
insurer from such insurance written in the United States, which the
gross premiums of the insurer from such insurance written in this
State bear to the gross premiums of the insurer from such insurance
written within the United States, at the rate of 5 per centum, which
tax shall be in lieu of all other taxes and licenses, state, county
and municipal, upon such insurer, except taxes upon real estate, and
such other taxes as may be assessed or levied against such insurer on
account of any other class of insurance written by it. The
Legislature shall define the terms "ocean marine insurance" and
"underwriting profit," and shall provide for the assessment, levy,
collection and enforcement of the ocean marine tax.
(h) The taxes provided for by this section shall be assessed by
the State Board of Equalization.
(i) The Legislature, a majority of all the members elected to each
of the two houses voting in favor thereof, may by law change the
rate or rates of taxes herein imposed upon insurers.
(j) This section is not intended to and does not change the law as
it has previously existed with respect to the meaning of the words
"gross premiums, less return premiums, received" as used in this
article.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 29. (a) The Legislature may authorize counties, cities and
counties, and cities to enter into contracts to apportion between
them the revenue derived from any sales or use tax imposed by them
that is collected for them by the State. Before the contract becomes
operative, it shall be authorized by a majority of those voting on
the question in each jurisdiction at a general or direct primary
election.
(b) Notwithstanding subdivision (a), on and after the operative
date of this subdivision, counties, cities and counties, and cities
may enter into contracts to apportion between them the revenue
derived from any sales or use tax imposed by them pursuant to the
Bradley-Burns Uniform Local Sales and Use Tax Law, or any successor
provisions, that is collected for them by the State, if the ordinance
or resolution proposing each contract is approved by a two-thirds
vote of the governing body of each jurisdiction that is a party to
the contract.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 30. Every tax shall be conclusively presumed to have been paid
after 30 years from the time it became a lien unless the property
subject to the lien has been sold in the manner provided by the
Legislature for the payment of the tax.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 31. The power to tax may not be surrendered or suspended by
grant or contract.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 32. No legal or equitable process shall issue in any
proceeding in any court against this State or any officer thereof to
prevent or enjoin the collection of any tax. After payment of a tax
claimed to be illegal, an action may be maintained to recover the tax
paid, with interest, in such manner as may be provided by the
Legislature.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 33. The Legislature shall pass all laws necessary to carry out
the provisions of this article.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 34. Neither the State of California nor any of its political
subdivisions shall levy or collect a sales or use tax on the sale of,
or the storage, use or other consumption in this State of food
products for human consumption except as provided by statute as of
the effective date of this section.
CALIFORNIA CONSTITUTION
ARTICLE 13 TAXATION
SEC. 35. (a) The people of the State of California find and declare
all of the following:
(1) Public safety services are critically important to the
security and well-being of the State's citizens and to the growth and
revitalization of the State's economic base.
(2) The protection of the public safety is the first
responsibility of local government and local officials have an
obligation to give priority to the provision of adequate public
safety services.
(3) In order to assist local government in maintaining a
sufficient level of public safety services, the proceeds of the tax
enacted pursuant to this section shall be designated exclusively for
public safety.
(b) In addition to any sales and use taxes imposed by the
Legislature, the following sales and use taxes are hereby imposed:
(1) For the privilege of selling tangible personal property at
retail, a tax is hereby imposed upon all retailers at the rate of 1/2
percent of the gross receipts of any retailer from the sale of all
tangible personal property sold at retail in this State on and after
January 1, 1994.
(2) An excise tax is hereby imposed on the storage, use, or other
consumption in this State of tangible personal property purchased
from any retailer on and after January 1, 1994, for storage, use, or
other consumption in this State at the rate of 1/2 percent of the
sales price of the property.
(c) The Sales and Use Tax Law, including any amendments made
thereto on or after the effective date of this section, shall be
applicable to the taxes imposed by subdivision (b).
(d) (1) All revenues, less refunds, derived from the taxes imposed
pursuant to subdivision (b) shall be transferred to the Local Public
Safety Fund for allocation by the Legislature, as prescribed by
statute, to counties in which either of the following occurs:
(A) The board of supervisors, by a majority vote of its
membership, requests an allocation from the Local Public Safety Fund
in a manner prescribed by statute.
(B) A majority of the county's voters voting thereon approve the
addition of this section.
(2) Moneys in the Local Public Safety Fund shall be allocated for
use exclusively for public safety services of local agencies.
(e) Revenues derived from the taxes imposed pursuant to
subdivision (b) shall not be considered proceeds of taxes for
purposes of Article XIIIB or State General Fund proceeds of taxes
within the meaning of Article XVI.
(f) Except for the provisions of Section 34, this section shall
supersede any other provisions of this Constitution that are in
conflict with the provisions of this section, including, but not
limited to, Section 9 of Article II.
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