California Department of Tax and Fee Administration

Last updated
California Department of Tax and Fee Administration
California Department of Tax and Fee Administration logo raster.png
Agency overview
FormedJanuary 1, 2018 (2018-01-01)
Preceding agency
Jurisdiction Statewide jurisdiction over sales, use and special taxes
Headquarters Sacramento, California
38°32′40″N121°24′26″W / 38.544344966644864°N 121.40727108202177°W / 38.544344966644864; -121.40727108202177
Agency executive
  • Nicolas Maduros, Director (as of 2021)
Parent agency California Government Operations Agency
Website cdtfa.ca.gov

The California Department of Tax and Fee Administration (CDTFA) is the public agency charged with assessing and collecting sales and use taxes, as well as a variety of excise fees and taxes, for the U.S. state of California. The department has several other ancillary functions, such as ensuring that sellers comply with permit requirements. The department was formed on January 1, 2018, by the Taxpayer Transparency and Fairness Act of 2017, which reduced the California State Board of Equalization to its constitutional functions of supervising county tax assessors and assessing certain specified types of property.

Contents

The department is one of the State of California's three primary state taxing agencies, collecting over 70 billion dollars annually in revenue for the State. [1] The other two are the Employment Development Department and the Franchise Tax Board. [2]

History

The collection of almost all state sales taxes and special fees, prior to the formation of the Administration, was handled by the California State Board of Equalization, a constitutional body composed of constitutional offices; despite almost a century of attempts to reform the Board, owing to various corruption-related concerns, these efforts were not successful for most of its history. [3] However, in 2017, a Department of Finance audit revealed missing funds and signs of nepotism by the Board's members, including the misuse of state time by requiring Compliance Representatives and other administrative workers to do menial work for promotional events. [4] [5] In June 2017, the California Department of Justice began a criminal investigation into the members of the Board. [6]

On June 27, 2017, the California State Legislature stripped the Board of most of its powers; its collection and assessment functions were transferred to the Administration, while its appeal powers were transferred to the California Office of Tax Appeals. [7] This constituted the shift of 90% of workers into the new departments. [7]

Appeals

Appeals from tax and fee decisions made by the department go to the Office of Tax Appeals, as with the Franchise Tax Board. This excludes appeals from matters concerning the Alcoholic Beverage Tax and the Tax on Insurers, as the department is only contracted to collect those taxes on behalf of the Board of Equalization.

Tax and fee programs

The department handles the vast majority of California's sales, use and excise tax assessment, auditing and collection. It also collects the 1.25% Bradley-Burns Uniform Local Sales and Use Tax and various 'district taxes'.

Former programs

See also

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References

  1. "California Department of Tax and Fee Administration (CDTFA)".
  2. Daniel L. Simmons, California Tax Collection: Time for Reform, 48 Santa Clara L. Rev. 279 (2008).
  3. Ashton, Adam (23 April 2017). "For 90 years, Californians have tried to kill this tax board. This is why they failed". The Sacramento Bee . Retrieved 25 April 2017.
  4. Ashton, Adam (24 March 2017). "Audit: California tax collectors on 'parking lot duty' for promotional events as politicos push boundaries". The Sacramento Bee . Retrieved 25 April 2017.
  5. Ashton, Adam (31 March 2017). "Here's the audit shaking up the Board of Equalization". The Sacramento Bee . Retrieved 25 April 2017.
  6. Ashton, Adam (20 June 2017). "Criminal investigation targets California tax board leaders". The Sacramento Bee . Retrieved 18 July 2017.
  7. 1 2 McGreevy, Patrick (27 June 2017). "In massive shakeup, Gov. Jerry Brown breaks up California's scandal-plagued tax collection agency". Los Angeles Times . Retrieved 18 July 2017.