Ordinance 491
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Q B. 12 in!'!,! Q ~ !'! Q. 491
AN ORDINANCE OF THE CITY OF GILROY IMPOSING A LICENSE TAX FOR THE PRIVILEGE OF
SELLING TANGIBLE PERSONAL PROr'ERTY AT RETAIL, PROVIDING FOR PERI/HTS TO RETAILERS,
PROVIDING FOR THE COLLECTING AND PAYING OF SUCH TAX, AND PRESCRIBING PENAL'l'IES
FOR VIOLATIONS OF THE PROVISIONS HEREOF.
THE MAYOR AND COMlvION COUNCIL OF THE CITY OF GILROY DO ORDAIN AS FOLLOWS:
SECTION 1. IMPOOITION AND ~TE.PF TAX. For the privilege of selling
tangible personal property at retail a tax is hereby imposed upon all retailers
at the rate of one-half of one percent <t of 1%) of the gross receipts of any
retailer from the sale of all tangible personal propert.y sold at retail in the
City of Gilroy on or after the first day ('f January, .1951. The license tax
imposed by the provisions of this ordinance is in addition to any and all other
taxes imposed by any other ordinance of the City of Gilroy.
SECTION 2. TAX LEVIED IN SAME MANNER AS STATE TAX. The tax hereby
levied, except as otherwise herein nrovided, is levied in the same manner, to the
same extent and under the same conditions as sales taxes are levied pursuant to
Part 1 of Division 2 of the California Revenue and Taxation Code, known as the
"Sales and Use Tax Law," as amended and in force and effect at the time this
ordinance becomes effective.
SECTION 3. ADOPTION OF STATE SALES TAX LAW BY REFERENCE. EXCEPTIONS.
All of the provisions of the "Sales and Use Tax Law," as amended ar,d in force and
effect at the time this ordinance becomes effective except the provisions thereof
pertaining solely to the "Use Tax" and Sections 6051, 6052, 6053, 6066, 6067,
6068, 6069, 6070, 6071, 6451, 7052, 7056, 7101, 7102, 7151, 7152, 7153, applicable
to sales of proDerty at retail, are hereby adopted and made a part of this
ordinance as though fully set forth herein, and all provisions of any other
ordinance in conflict therewith are inapplicable to this ordinance and the tax
hereby imposed; provided, however, the term "gross receipts," as used herein,
does not include the amount of any tax imposed by the State of California upon
or with respect to retail sales whether imposed upon the retailer or upon the
consumer.
All of the provisions of the "Sales and Use Tax Law" hereby adopted,
providing for the adoption of rules and regulations and for hearings on the part
of the State Board of Equalization, shall be performed by the City Council of the
Oi ty of Gilroy. All other provisions of the "Sales and Use Tax Law" hereby
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adopted, providing for the performance of official action on the part of the
State Board of Equalization, shall be performed by the City Tax Collector.
The City of Gilroy shall be deemed substituted for the State of California
whenever the State is referred to in said "Sales and Use Tax Law."
The City Attorney of Gilroy shall be deemed substituted for the Attorney
General w'lenever the .!Attorney General is referred to in said "Sales and Use
Tax Law."
The City Clerk shall be deemed substituted for the state Controller
whenever the State Controller or State Board of Control are referred to in said
nSa1es and Use Tax Law."
The County of Santa Clara shall be deemed substituted for the County of
Sacramento whenever the County of Sacramento is referred to in said "Sales and
Use Tax Law.1t
SECTION 4. EXEMPTIONS. (a) In addition to those exemptions contained
in Part 1 of Division 2 of the Revenue and Taxation Code of the State of
California, included in this ordinance by reference, there shall be eXQluded
from the computation of the tax, gross receipts from:
(i) Sales made to or by the State of California or any agency
departillent, n01itical SUbdivision, district or municipal corporation thereof;
(ii) Sales of property to be consumed in, or incorporated into
the erection, construction, repair or alteration of either public works or
buildings belonging to or being constructed by or on behalf of, or for the use
of the United States Government, the State of California or any agency, department,
political subdiVision, district or public or municipal corporation of the state;
(iii) Sales made pursuant to contracts actually executed in good
faith prior to the effective date of this ordinance;
(iv) Sales of meals, food and drinks sold or served on common carriers
operating into, throught or out of the city from or to points outside this city.
(v) The sales tax does not apply to sales of property which 1s shipped
to a point outside of this city, pursuant to the contract of sale, by delivery
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by the retailer to such point by means of (1) facilities operated by the retailer,
(2) delivery by the retailer to a carrier for shipment to a consignee at such
point, or (3) delivery by the retailer to a customs broker or forwarding agent
for shipment outside this city."
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(b) No tax shall be due hereunder if a sales tax, purchase tax, use tax,
or purchase and use tax imposed by any other city of the State of California has
been paid on the same transaction.
SECTION 5. ADOPTION OF RULES AND REGULATIONS BY REFERENCE. INTERPRETATIONS.
The rules and regulations of the State Board of Equalization as amended and in
force and effect at the time this ordinance becomes effective pertaining to the
interpretation, administration and enforcement of the "Sales and Use Tax Law,"
insofar as applicable, except Rule No. 55 (Section 2015, Title 18, California
Administrative Code, Sales & Use Tax) shall apply in the interpretation of this
ordinance until specifically abandoned by the rules and regulations adopted by
the City Council of Gilroy pursuant to this ordinance. The word "City" shall
be deemed substituted for the word "State" whenever the word "State" appears in
said rules and regulations.
In lieu of Rule No. 55, specifically excepted above, the following in-
terpretations shall apply in the administration of this ordinance:
(A) The sales tax does not apply to sales of property which is:
(i) Imported into this city from a foreign country and sold b;l the
importer in 'the original package in which imported.
(ii) Sold to foreign purchasers for shipment abroad and delivered
to a ship, airplane, or other conveyance furnished by the purchaser for the
purpose of carrying the property abroad and actually carried to a foreign
destination, title and control of the property passing to the foreign purchaser
upon delivery, and no portion of the property being used or consumed in the
United States. Copies of U. S. Customs Shippers' export declarations filed with
the Collector of Customs must be obtained and retained by retailers to support
deductions taken under this paragraph. The tax applies to the transaction if the
property is diverted in transit or for any reason not actually delivered outside
the City pursuant to the contract of sale or not shipped abroad by a foreign
purchaser, regardless of documentary evidence held by the retailer of delivery
of the propert~r to a carrier for shipment outside the City, or to a foreign
purchaser for shipment abroad.
(iii) Mailed by the seller, pursuant to the contract of sale, to persons
in the armed forces at points outside continental United States, notwithstanding
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the property is addressed in care of the Postmaster and forwarded by him to the
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addressee. When mail is addressed to Arrnf Post Offices (A/P/o/'s) in care of
the Postmaster or to naval forces addressed in care of the Postmaster, it will
be presumed that it is forwarded outside California. The seller must keep
records showing the names and addresses as they appear on the mailed matter and
should keep evidence that the mailing was done b.1 him.
(iv) Shipped to a point outside thi's City pursuant to the contract
of sale when the property is marked for export and delivered by the retailer to
the "contracting officer," "officer in charge," '\:>crt quartermaster, II or other
officer of the United States for transportation and delivery to the purchaser at
such a point.
(B) The sales tax does not apply to sales of airplanes, and parts and
equipment for airplanes, transported to a point outside this City pursuant to
the contract of sale when such property is delivered to the United states jrmy
Corps or ar'y other agency or instrumentality of the United states for trans-
portation and delivery to the purchaser or someone designated by him at that
point.
(C) The sales tax does not apply (either in interstate or intrastate
commerce) to sales of property shipped from a point outside the City of Gilroy
to a purchaser inside the City of Gilroy, or to the retai1er's agent in the City
of Gilroy, for delivery to the purchaser, if none of the elements of sale, other
than such delivery, takes place in the City of Gilroy.
The sales tax ~ apply (either in interstate or intrastate commerce)
to sales of property shipped from a point outside of the City of Gilroy to a
purchaser inside the City of Gilroy, or to the retailer's agent in the City of
Gilroy, for delivery to the purchaser where any element of the sale, in addition
to such delivery, takes place in the City of Gilroy.
IlIElementc:f Sale" is hereby defined to include solicitation of an order,
the acceptance of an order, the giving of an order, whether such order is given
in person, by telephone or by mail, or the payment of the purchase price.
SECTION 6. FORMULA COMP'f.ITATION OF SALES AND USE TAX BY RETAILERS LOCATED
OUTSIDE CITY. The City Tax Collector may anprove the payment of the sales tax
by retailers located outside the city in accordance with a formula if he finds
that the formula will produce the same or approximately the same tax as if
detailed accounting procedures had been followed. A retailer desiring to use
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such a formula shall furnish such information as may be required by the City
Tax Collector to enable him to make the required finding. The formula may be'
used by the retailer for such period of time, not to exceed one year, as may
be authorized by the City Tax Collector in writing, and is subject to renewal,
upon application, for periods not to exceed one year.
Payment in full of sales taxes in accordance with an approved formula
shall constitute full satisfaction of the retailer's sales tax liability."
SECTION 7. VmBATIM EXCERPl'S SHALL NOT EXCLUDE BALANCE. The inclusion
of any clause, portion or part of the "State Sales and Use Tax Law," Part 1,
Division 2 of the Revenue and Taxation Code of the State of California, or the
rules and regulations of the State Board of Equalization, verbatim in this ordinance
shall not in or of itself be deemed to exclude any of the remaining provisionsaf
said "Sales and Use Tax Law" or rules and regulations that are made a part
hereof by reference only.
SECTION 8. APPLICATION FOR PER1ITT. Every person desiring to engage
in or conduct business as a seller within the at y of Gilroy shall file with the
City Tax Collector an application for a perldt for each place of business from
which taxable sales will be made. Every application for a permit shall be made
upon a form prescribed by the City Tax Collector, and shall set forth the name
under which the applicant transacts or intends to transact business, the location
of his place or places of business, and such other information as the City Tax
Collector ma~7 require. The application shall be signed b:r the owner, if a
natural person; in the case of a corporation, by and executive officer or some
person specifically authorized by the corporation to sign the application, to
which shall be attached the written evidence of his author it Yo
SECTION 9. ,J;,SSUANCE AND DISPLAY OF PERMIT. A.fter compliance with
Section 8 of this ordinance by the applicant, the City Tax Collector shall grant
and issue to each applicant a separate permit for each place of business from
which taxable sales will be :lade. A permit is not assignable and is valid only
for the person in whose nane it is issued and for the transaction of business
at the place designated therein; provided, however, a change of location may be
endorsed upon the permit by the City Tax Collector. The permit shall at all
times be conspicuously displayed at the place for which issued.
SECTION 10. PERMIT FEFE. At the time of making an application for a
permit, and at the time a change of location is endorsed upon a permit, the
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applicant for a permit or for an endorsement of a change of location on a permit
shall pay to the City Tax Oollector a fee of $1.00.
SECTION 11. REVOCATION OF PERMIT. Whenever any person fails to comply
with any of the provisions of this ordinance or any rnle or regulation adopted
pursuant hereto, the City Council of the City of Gilroy, upon hearing, after
giving the person ten days' notice in writing specifying the time and place of
hearing and requiring him to show cause why his permit or permits should not be
revoked, may revoke or suspend anyone or more of the permits held by the person.
The notice may be served p"rsonal1y or by mail in the manner prescribed for the
service of notice of a deficiency determina..tion under the "Sales and Use Tax
Law." The City Tax <<.ollector shall not issue a new permit after the revocation ct
a permit unless the City Council of the City of Gilroy is satisfied that the
former holder of a permit will comply with the provisions of this ordinance and
the rules and regulations adopted pursuant hereto and directs the City Tax
Collector to issue such permit.
SECTION 12. RENEWAL OF PERMIT. A seller whose permit has been pre-
viously suspended or revoked shall pay the Ci tJr Tax Collector a fee of $1.00
for the renewal or issuance of a permit.
SECTION 13. UNLAvVFUL ACTS. A person who engages in business as a seller
in the City of Gilroy without a permit or permits, or after a permit has been
suspended or revoked and before the renewal or issuance of a permit, and each
officer of any corporation which so engages in business, is guilty of a misdemeanor.
SECTION 14. DUE DAT!';. The taxes imposed by this ordinance are due and
payable to the City Tax Collector on or before the last day of the month next
succeeding each quarterly period, th~ first quarter1y.payment to be due and
payable under this ordinance OJ?- the 30thiay of April , 19 51. The Tax
Collector may require returns and payment of the amount of taxes for quarterly
periods other than calendar quarters depending upon the principal place of or the
nature of the business of the seller or retailer or may require returns and
payment of the amount 0 taxes for other than quart,erly periods.
SECTION 15.. REIMBURSIDilENT. The tax here by imposed shall be collected
by the retailer from the consumer insofar as it can be done.
SECTION 16. UNlJlWFUL ADVERTISING. It is unlawful for any retailer to
advertise or hold out or state to the public or to any customer, directly or in-
directly, that the tax or any part thereof will be assumed or absorbed by the
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retailer or that it will not be added to the selling price of the property sold
or that, if added, it or any part thereof will be refunded. Any person
violating any provision of this section is guilty of a misdemeanor.
SECTION 17. SUIT FOR TAX. All taxes hereby levied shall be payable to
the City Tax Collector and any civil suit for the collection thereof may be
flIed in any court of competent jurisdiction in the state of California, and the
City Attorney of said City shall prosecute the action.
SECTION 18. RE3ALE CERTIFICATE. The City Tax Collector may at his option
accept a State of Califor ia Resale Certificate as evidence that any sale is not
a slae at r~tail, or he may in his discretion require an affidavit from the
seller setting forth such information respecting such sale as he deems necessary
to determine the nature of such sale.
SECTION 19. EXTENSION OF '~'IME. WAIVER OR COMPROMISE. The Tax Collector
shall have power, for good cause shovm, to extend for a period of not to exceed
30 days the time for making any return or paying any amount required to be paid
under this ordinance, when requested so to do in \~iting, before the same
becomes delinquent. The Tax Collector may, with the written approval of the
City Attorney, waive or compromise any penalty or interest that would otherwise
accrue under the provisions of this ordinance. The Tax Collector shall make and
transmit to the City Council quarterly, a detailed report of any St~ so waived
or compromised VIi th the reasons therefor.
SECTION 20. DISPOSITION OF PROCEEDS. All monies collected ~der and
pursuant to the provisions of this ordinance shall be deposited and paid into
the General FlUld of the City of Gilroy.
SECTION 2l. DIVULGING OF INFORMATION FORBIDDEN. It is unlawful for any
officer or employee of the C:1.ty of Gilroy having an administrative duty under
this ordinance to make known in any manner whatever the business affairs, opera-
tions, or information obtained by an investigation of records and equipment of
any retailer or any other person visited or examined in the discharge of official
duty, or the amount or source of illcome, profits, losses, expenditures, or any
particular thereof, set forth or disclosed in any rett~n, or to permit any return
or copy thereof or any book containing any abstract or partic lars thereof to
be seen or examined by any person. However, the City Council may, by resolution,
authorize examination of the returns by Federal or State officers or employees
or by the tax officers of this or any other city if a reciprocal arrangement
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exists. Successors, receivers, trustees, executors, administrators,
assignees, and guarantors, if directly interested, may be given
information as to the items included in the measure and amounts
of any unpaid tax or amounts of tax required to be collected,
interest and penalties.
SECTION 22. PENALTIES. Any person required to make,
render, sign or verify any report under the provisions of this
ordinance, who makes any false or fraudulent return, with
intent to defeat or evade the determination of an amount due and
required to be paid hereunder, is ~lilty of a misdemeanor, and
upon conviction thereof shall be punishable by a fine of not more
than $100.00 or by imprisonment for a period of not more than
thirty days, or by both such fine and imprisonment.
SECTION 23. ~. Any person, firm or cdrporation
violating any of the terms of this ordinance shall be deemed guilty
of a misdemeanor, and upon conviction thereof shall be punishable
be a fine of not more than $100.00 or by imprisonment for a periOd
of not more than thirty days, or by both such fine and imprisonment.
SECTION 24. SEVERABILITY. If any section, subsection,
sentence, clause, phrase, or portion of this ordinance is for
any reason held to be invalid or unconstitutional by the decision
of any court of competent jurisdiction, such decision shall not
affect the validity of the remaining portions of this ordinance.
The Council of this City hereby declares that it would have adopted
this ordinance and each section, subsection, sentence, clause,
phrase or portion thereof, irrespective of the fact that anyone
or more sections, subsections, clauses, phrases, or portions
be declared invalid or unconstitutional.
SECTION 25. EFFECTIVE DATE. This ordinance shall take
effect and be in full force from and after the 1st day of
January, 1951.
Adopted and Passed this 13th day of
by the following vote:
December
, 1950 t
AYES:
Councilmen:George M.Mason,J.H.Wentworth,James B.
Tho~~,David V.Stout,Dale D.Daniels,
Carl W.Pate.
ATTEST:
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NOES:
ABSENT:
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Councilmen: None
Councilmen: None
Approved this 13th day of
December
, 1950.
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City lerk
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C) ICayor
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