Tampon Tax Exemption Moving in California Legislature

The Bloomberg BNA Tax Management Weekly State Tax Report filters through current state developments and analyzes those critical to multistate tax planning.

By Laura Mahoney

June 6 — Tampons and other menstrual supplies would be exempt from California sales and use tax under a bill passed by the Assembly.

A.B. 1561 by Assemblywomen Cristina Garcia (D) and Ling Ling Chang (R) is one of a dozen bills moving through state legislatures to exempt feminine hygiene products from tax. It passed the Assembly 68-0 June 2 without debate and moves to the Senate for consideration (2016 Weekly State Tax Report 24, 3/25/16).

Garcia said before the vote on the Assembly floor that the state shouldn't be in the business of taxing women because they are born women.

“Our sales tax code is a reflection of what we value,” Garcia said. “We value motion pictures and candy over women's health. It's time we start valuing women's health and stop taxing menstrual products.”

Motion pictures and candy are exempt from California sales and use tax.

The measure would apply to tampons, sanitary napkins, menstrual cups and menstrual sponges. The exemption would result in a revenue loss of $20 million a year, according to the State Board of Equalization. The five-member elected SBOE supports the bill.

Other Bills on the Move

The Assembly acted on A.B. 1561 in time to meet a deadline of June 3 for bills to pass their house of origin. Other tax policy bills that passed before the deadline include:

  • A.B. 2392 by Assemblyman Adrin Nazarian (D), which would allow a personal or corporate income tax credit of 30 percent of the cost of qualified seismic retrofit expenses, passed the Assembly 79-0 May 31;
  • by Nazarian, which would extend for three more years an existing county-level process for assessing aircraft for property tax purposes that is set to expire in the 2016-17 fiscal year, passed the Assembly 44-20 June 1;
  • S.B. 873 by Sen. Jim Beall (D), which would allow taxpayers to sell low-income housing tax credits and extend the sunset date on some provisions for sharing the credit, passed the Senate 39-0 May 31;
  • S.B. 907 by Sen. Cathleen Galgiani (D), which would conform California to federal law allowing exclusion of forgiven mortgage debt for a primary residence from taxable income, passed the Senate 39-0 May 31; and
  • by Sen. Ben Hueso (D), which would establish an income tax credit for employers that hire workers ages 18-25 who have been convicted of a felony and completed a work readiness program, passed the Senate 39-0 May 31.

 

Three of the bills—A.B. 2392, S.B. 873, and S.B. 907—are nearly identical to three bills Gov. Jerry Brown (D) vetoed in 2015 out of frustration that lawmakers had failed to fix an improper tax on health plans and were leaving a $1 billion hole in the budget. The Legislature enacted a fixed managed care organization tax in May, so lawmakers are trying again to enact the vetoed bills (2016 Weekly State Tax Report 25, 5/20/16).

The bills must pass their second house by Aug. 31, the last day of the 2016 session, to reach the governor's desk.

To contact the reporter on this story: Laura Mahoney in Sacramento, Calif., at lmahoney@bna.com

To contact the editor responsible for this story: Ryan Tuck at rtuck@bna.com

For More Information

More information about the bills is at http://src.bna.com/fEL.