California Department of Tax and Fee Administration

Effective July 1, 2017 the California Board of Equalization will be broken into newly formed governing bodies encompassing the same scope of responsibility, but with increased focus and accountability. California has unintentionally scribed a list of reasons collection and accountability procedures need to be revised, citing the Los Angeles Times, the new structure “strips the scandal-plagued state tax collection agency of most of its powers…” Currently under Department of Justice investigation for “member and employee mismanagement” of nearly $350 million in sales tax revenue, separating the tax and fee administration and creating an entirely new entity with limited authority is seen as a “dramatic” move toward integrity for Governor Jerry Brown.

Focus of the newly formed agency centers around their ability to lead a “fair and equal tax administration in (California) and to uphold the Taxpayers’ Bill of Rights.” This shift comes at a period of low confidence considering the department’s recent conduct. The California Department of Tax and Fee Administration (CDTFA) and the Office of Tax Appeals will conduct most of the day to day responsibilities of the California State Board of Equalization with the passing of Assembly Bill 102, the Taxpayer Transparency and Fairness Act of 2017.

Relating to taxpayers, due dates will remain the same as before the transition and there should not be any substantial difference in the collection process. The CDTFA will be responsible for the collection of sales and use tax, while the Office of Tax Appeals is granted significant authority in their ability to coordinate the appeals process, seen as the most important article in the “Taxpayer Bill of Rights”. The Board of Equalization will continue to conduct programs pertaining to property, alcohol, and insurance taxes and until December 31, 2017, will hear taxpayer appeals to facilitate the transition into the Office of Tax Appeals.

Wesley Sprecher

 

Tips for the Taxpayer

Stay up-to-date with state and local tax news. If your company operates in California be aware of governing transition as current programs may not carry through the transition process. Any government restructuring has external unintended consequences that could be felt in the business world as adjustments are caught up to date.

Tax rate changes are not on the agenda in the state of California, but it would not be unlikely to alter rates and processes as the new department self-audits their predecessor to boost operational efficiency. In an audit, the taxpayer will be responsible for the correct tax rate. Stay current with your state, county, and city legislation. Look for planning opportunities and exemptions that might be applicable to your company.

 

How Can We Help?

Allyn’s tax team is staffed with seasoned tax professionals experienced in all aspects of Federal, multi-state and local tax compliance and consulting for large US and global corporations. We use that experience to your advantage.

Allyn files state and local sales and use tax returns in every US taxing jurisdiction. We can manage your tax compliance, create a solid tax process, and provide audit defense for your company. Further, we have experience working with state and local government entities and relish the opportunity to alleviate the administrative burden that comes with program implementation in areas aspiring to spur employment growth.

Contact us and we can provide a customized cost-effective solution to meet your company’s needs. For further information on Allyn Tax services, please contact tax@allynintl.com.

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