Vote Smart's Synopsis:

Vote to pass a bill that temporarily increases the gross receipts and compensating tax rate and requires a referendum for increasing municipal gross receipts tax rates beginning July 1, 2010.

Highlights:

-Increases the gross receipts and compensating tax rate as follows (Secs. 4-5):

-Existing Law: 5 percent of gross receipts; -New Law:
-5.5 percent of gross receipts for fiscal year 2010-2011; -5.375 percent of gross receipts for fiscal year 2011-2012; -5.25 percent of gross receipts for fiscal year 2012-2013; -5.125 percent of gross receipts for fiscal year 2013-2014; and -5 percent of gross receipts for fiscal year 2014-2015 and each subsequent fiscal year thereafter.

-Establishes a tax credit against the gross receipts tax for eligible Medicaid dental providers for performing pediatric dental services equal to the following rates (Sec. 6):

-0.5 percent of taxable gross receipts for fiscal year 2010-2011 ; -0.375 percent of taxable gross receipts for fiscal year 2011-2012; -0.25 percent of taxable gross receipts for fiscal year 2012-2013; and -0.125 percent of taxable gross receipts for fiscal year 2013-2014.

-Requires a referendum for imposing a municipal gross receipts tax if specified in the ordinance or if a petition requesting an election is filed, and specifies that if the referendum fails, the ordinance is repealed and the tax increase cannot be considered for at least 1 year after the election (Sec. 7). -This is a substitute bill sponsored by the House Committee on Taxation and Revenue.

Full Bill Text