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Business Taxes Law Guide—Revision 2024
Transactions and Use Tax Court Decisions
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C.O.D. Gas and Oil Co., Inc. v. State Board of Equalization … (1997)
Coleman v. County of Santa Clara … (1998)
County of San Diego; Rider v.,
See Rider v. County of San Diego … (1991)
C.O.D. Gas and Oil Co., Inc. v. State Board of Equalization … (1997)
Claim for Refund of Unconstitutional District TaxesPlaintiff motor vehicle fuel retailers sought refund of district taxes they had paid to the state which were later declared to be unconstitutional. Plaintiffs argued that they had the right to file an action for refund of such taxes even though the Legislature had adopted a comprehensive statutory scheme whereby it is the purchasers who have the right to file the claims for refund of unconstitutional district taxes, rather than retailers as is generally the case. The Court of Appeal held that the statutory scheme was constitutional and that it clearly prohibited these retailers from filing claims. Since plaintiffs had no statutory basis for maintaining an action for refund, the trial court’s dismissal of the suit was upheld. C.O.D. Gas and Oil Co., Inc. v. State Board of Equalization (1997) 59 Cal.App.4th 756.
Coleman v. County of Santa Clara … (1998)
A District Tax Adopted by a Simple Majority Vote Is Valid Because It Is Not a Special TaxThe voters of Santa Clara County adopted a new district tax during the 1996 general election by a simple majority vote (51.8 percent). This tax was adopted as Measure B, which specified that the ½ percent sales and use tax would be used for general county purposes. During the same election, the voters also approved Measure A by 77.6 percent of the vote. This was characterized in the measure itself and in the voter pamphlet as advisory only. It specified the voters' intent that any new sales tax revenue should be spent on certain projects specified in that measure.
Plaintiffs challenged the new tax as an attempt to circumvent the supermajority requirement for special taxes in that the measures were inseparably linked, meaning that Measure B was actually a special tax requiring a two-thirds vote to be validly adopted rather than a mere majority vote as required for a general tax. The Court of Appeal held that, although the two ballot measures were closely related to each other, they were not, in fact, legally connected. By itself, Measure B was a general tax which could be adopted by majority vote. Despite the passage of Measure A, the County was free to spend Measure B revenue on any and all County purposes without restriction, and the validity of neither measure was dependent on the passage of the other. The court therefore upheld the validity of the new tax. Coleman v. County of Santa Clara (1998) 64 Cal.App.4th 662.