Mountain View Municipal Code Div. 2 Telecommunications Users Tax

Footnotes:

--- (1) ---

Editor's note— Ord. No. 17.10, § 2, adopted November 2, 2010, amended the Code by, in effect, repealing former div. 2, §§ 29.16—29.19, and adding a new div. 2. Former div. 2 pertained to the telephone users tax, and derived from Ord. No. 29.70, adopted August 10, 1970; Ord. No. 2.71, adopted January 11, 1971; Ord. No. 12.06, December 12, 2006.

A. There is imposed a tax upon every person, other than a telephone corporation, who uses telecommunication services in the city, including intrastate, interstate and international telecommunication services, to the extent permitted by federal and state law. Interstate calls shall be deemed to include calls to the District of Columbia. The telecommunications users tax is intended to, and does, apply to all charges within the city's tax jurisdiction, such as charges billed to a telecommunications account having a situs in the city as permitted by the Mobile Telecommunications Sourcing Act of 2000, 4 USCA 116 et seq. The tax imposed by this section shall be at the rate of three (3) percent. The tax shall apply to all charges made for such telecommunication services. There is a rebuttable presumption that telecommunication services billed to a billing or service address in the city are used, in whole or in part, within the city, and that such services are subject to taxation under this chapter. There is also a rebuttable presumption that telecommunication services sold within the city that are not billed to a billing address or provided to a primary physical location (such as prepaid calling card services) are used, in whole or in part, within the city and are therefore subject to taxation under this chapter.

B. As used in this section, the term "charges" shall include the value of any other services, credits, property of every kind or nature, or other consideration provided by the service user in exchange for the telecommunication services.

C. The collector may, from time to time, issue and disseminate to telecommunication service suppliers administrative rulings identifying those telecommunication services that are subject to the tax of Subsection A of this section or otherwise regarding the implementation of the tax. Such administrative rulings shall be consistent with legal nexus and laws pertaining to telecommunications services and shall not impose a new tax, revise an existing tax methodology or increase an existing tax, except as allowed by California Government Code Section 53750(h) (2) and (3) or other law. The collector may consider state-wide interpretive rules and guidelines promulgated by any government agency or association of government agencies as a factor in determining the intent of voters adopting this section. To the extent that the collector determines that the tax imposed under this section shall not be collected in full for any period of time, such an administrative ruling falls within the collector's discretion to settle disputes. The collector's exercise of prosecutorial forbearance under this chapter does not constitute a change in taxing methodology for purposes of Government Code Section 53750(h), and the city does not waive or abrogate its ability to impose the telecommunications users tax in full as a result of issuing such administrative rulings and may suspend such rulings and recommence collection of the tax without additional voter approval.

D. The following shall be exempt from the tax imposed by this section:

1. Charges paid by inserting coins in coin-operated telephones available to the public with respect to local telephone service, or with respect to long distance telephone service if the charge for such long distance telephone service is less than twenty-five (25) cents; except that where such coin-operated telephone service is furnished for a guaranteed amount, the amounts paid under such guarantee plus any fixed monthly or other periodic charge shall be subject to the tax.

2. Except with respect to local telephone service, on any charges for services used in the collection of news for the public press, or a news ticker service furnishing a general news service similar to that of the public press or radio broadcasting, or in the dissemination of news through the public press, or a news ticker service furnishing a general news service similar to that of the public press, or by means of radio broadcasting, if the charge for such service is billed in writing to such person.

3. Charges for services furnished to an international organization designated under the International Organizations Immunities Act and defined in 22 USCA 288 or to the American National Red Cross.

4. Charges for any long distance telephone service which originates within a combat zone, as defined in Section 112 of the Internal Revenue Code, from a member of the Armed Forces of the United States performing service in such combat zone, as determined under such section, provided a certificate setting forth such facts as the Secretary of the U.S. Treasury may by regulations prescribe is furnished to the person receiving such payment.

5. Charges for any long distance telephone service to the extent that the amount so paid is for use by a common carrier, telephone or telegraph company, or radio broadcasting station or network in the conduct of its business as such.

6. Amounts paid by a nonprofit hospital for services furnished to such organization. For purposes of this subsection, the term "nonprofit hospital" means a hospital referred to in Internal Revenue Code Section 170(b)(1)(A)(iii) which is exempt from income tax under Internal Revenue Code Section 501(a).

7. Charges for services or facilities furnished to the government of any state, or any political subdivision thereof, or the District of Columbia.

8. Charges paid by a nonprofit educational organization for services or facilities furnished to such organization. For purposes of this subsection, the term "nonprofit educational organization" means an educational organization described in Internal Revenue Code Section 170(b)(1)(A)(ii) which is exempt from income tax under Internal Revenue Code Section 501(a). The term also includes a school operated as an activity of an organization described in Internal Revenue Code Section 501(c)(3) which is exempt from income tax under Internal Revenue Code Section 501(a), if such school normally maintains a regular faculty and curriculum and normally has a regularly enrolled body of pupils or students in attendance at the place where its educational activities are regularly carried on.

9. Charges for maritime mobile services as defined in Section 2.1 of Title 47 of the Code of Federal Regulations as such section existed on January 1, 1970.

E. To prevent actual multi-jurisdictional taxation of telecommunication services subject to tax under this section, any service user, upon proof to the collector that the service user has previously paid the same tax in another American jurisdiction on such telecommunication services, shall be allowed a credit against the tax imposed to the extent of the amount of such tax legally imposed in such other jurisdiction; provided, however, the amount of credit shall not exceed the tax owed to the city under this section. This ordinance shall be construed broadly in favor of the imposition and collection of the utility users tax to the fullest extent permitted by California and federal law, and as that law may change from time to time.

F. The tax on telecommunication services imposed by this section shall be collected from the service user by the service supplier or its billing agent. Each service supplier shall, on or before the twentieth (20) of each month, make a return to the collector, on forms provided, and in the manner prescribed, by the collector, stating the amount of taxes billed by the service supplier during the preceding month. At the time the return is filed, the full amount of the tax collected shall be remitted to the collector. The collector is authorized to properly determine if the tax imposed is levied and collected in accordance with this chapter. Returns and remittances are due immediately upon cessation of business for any reason.

G. For purposes of imposing a tax or establishing a duty to collect and remit a tax under this subchapter, "substantial nexus" and "minimum contacts" shall be construed broadly in favor of the imposition, collection and/or remittance of the utility users tax to the fullest extent permitted by state and federal law, and as that law may change from time to time. Any telecommunication service (including VoIP) used by a person with a service address in the city, which service is capable of making a call to another person on the general telephone network, shall be subject to a rebuttable presumption that "substantial nexus/minimum contacts" exists for purposes of imposing a tax, or establishing a duty to collect and remit a tax, under this chapter. A service supplier shall be deemed to have sufficient activity in the city to be obligated to collect and remit the tax imposed by this chapter if it does any of the following: maintains or has within the city, directly or through an agent or subsidiary, a place of business of any nature; solicits business in the city by employees, independent contractors, resellers, agents or other representatives; solicits business in the city by means of advertising that is broadcast or relayed from a transmitter within the city or distributed from a location within the city; or advertises in newspapers or other periodicals printed and published within the city or through materials distributed in the city by means other than the United States mail.

(Ord. No. 17.10, § 2, 11/2/10.)

To the extent that the city's authorization to impose or collect any tax imposed under this chapter is expanded or limited as a result of changes in state or federal law, no amendment or modification of this chapter shall be required to conform the tax to those changes, and the tax shall be imposed and collected to the full extent of the city's authorization up to the full amount of the tax imposed under this chapter.

(Ord. No. 17.10, § 2, 11/2/10.)