California has amended its legislation regarding registration for purposes of the state’s use tax. Previously, California tax law required that a qualified purchaser register with the California Department of Tax Fee Administration (CDTFA) for the collection of use tax if the person satisfied certain conditions and received at least $100,000 in gross receipts from business operations in a calendar year.
Per the new requirements, the definition of qualified purchaser is amended to remove the condition that the person receives at least $100,000 in gross receipts from business operations in a calendar year. It adds the new condition that the person is required to register for use tax if they meet certain conditions and make more than $10,000 in purchases subject to use tax in a calendar year if the tax has not been otherwise paid to a retailer.
The legislation notes that this section does not apply to the purchase of a vehicle, vessel or aircraft.
There was no urgency clause or effective date listed in the Assembly Bill. The amendment was signed by California Gov. Gavin Newsom and filed and Chaptered with the Secretary of State on October 7, 2023. It is expected the effective date of the legislation is January 1, 2024.
The legislation will sunset on January 1, 2029. (A.B. 1097, Laws 2023)