Beginning Jan. 1, the threshold for the California state sales/use tax exemption will become $1,500 instead of the current $1,000, the Industry Council for Tangible Assets announced in a Dec. 3 release.
All California dealers and any dealers who attend shows held in California will have to comply with this new exemption requirement, according to ICTA. After Jan. 1, only retail transactions taking place in California that total more than $1,500 will be exempted from California sales and use tax.
The council recommends that dealers take steps now to call this to the attention of their tax professionals and change any automatic applications such as computer programs.
The California exemption is one of the oldest, having been implemented more than 20 years ago, said ICTA.
The California Board of Equalization document states:
Revenue and Taxation Code (RTC) section 6355 and Regulation 1599, Coins and Bullion, provide an exemption from the sales and use tax for sales in bulk of monetized bullion, nonmonetized gold or silver bullion, and numismatic coins that are substantially equivalent to transactions in securities. Currently, a “sale in bulk” is defined as having a market value of one thousand dollars ($1,000) or more. As mandated by RTC section 6355, the Board of Equalization is required to index the coins and bullion bulk sale exemption threshold for inflation, based on the (June to June) California Consumer Price Index (CCPI), by September 1st each year. When the cumulative inflation adjustment equals or exceeds five hundred dollars ($500), the coins and bullion bulk sales exemption threshold increases to the next nearest multiple of $500, effective January 1 of the succeeding calendar year.
Therefore, by statue, the coins and bullion bulk sale exemption threshold will increase to $1,500 effective January 1, 2009. Revisions to Regulation 1599 are proposed to reflect the threshold increase.
For more information, contact ICTA by calling (504) 392-0023 or visiting its Web site at www.ictaonline.org.