ABX 128 - Windfall Tax

ABX 128 (Corbett), which establishes a windfall profits tax, passed out
of the Assembly Revenue and Taxation Committee on a party-line vote.
The bill was completely rewritten in committee to do the following. I
will fax bill language to Houston, Portland and San Francisco. If
anyone else would like language, please e-mail me.

a. Create a Tax on Excess Gross Receipts from Electrical Energy
Distribution.

b. Impose the tax on the person making the first sale of electrical
power in or into California for consumption.

c. Establish as the measure for the tax, the amount by which the
gross receipts from the sale exceed the amount that would have
been received if the sale had been made at a specified price (the 'base
price').

d. Establish a $60 base price.

e. Create a rebuttable presumption that the base price represents a
fair sales price.

f. Add a mechanism to require withholding of the tax from purchasers,
other than purchasers who are residential
consumers or small business users.

g. Require sellers to file annual tax returns to report the tax on
excess gross receipts and pay any remaining tax due.

h. Allow sellers to file a claim for refund in an attempt to rebut
the presumption that the base price represented a fair sales price with
respect to that seller.

i. Establish the connections to California giving rise to liability
for the tax.

j. Include a sunset date for the tax after 5 years.