Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2013
 

Alcoholic Beverage Tax Law

Business and Professions Code Provisions Relating To the Alcoholic Beverage Tax Law1

CHAPTER 4. IMPORTS2

1See Section 32002 of Revenue and Taxation Code in this volume.

2 The provisions of Chapter 4 of the Business and Professions Code were added to the Business Taxes Law Guide in 2006. Any changes to these provisions prior to 2006 will not be reflected in the history notes.

CHAPTER 4. IMPORTS2

23660. Right of postal authorities to refuse delivery of imported beverages. Postal authorities may refuse delivery of any shipment of alcoholic beverages originating outside this State. Postal authorities may turn alcoholic beverages over to the department. The alcoholic beverage when received shall be forfeited to the State.

23661. Who may import. Except as otherwise provided in this section, alcoholic beverages may be brought into this state from without this state for delivery or use within the state only by common carriers and only when the alcoholic beverages are consigned to a licensed importer, and only when consigned to the premises of the licensed importer or to a licensed importer or customs broker at the premises of a public warehouse licensed under this division.

The provisions of this chapter are not applicable in the case of alcoholic beverages which are sold and delivered by a licensee in this state to another licensee in this state, and which in the course of delivery are taken without this state through another state without any storage thereof in such other state.

The provisions of this section are not applicable in the case of a reasonable amount of alcoholic beverages brought into this state by an adult from without the United States for personal or household use; except that a California resident returning to the United States by a vehicle which is not a common carrier, or any adult entering the United States as a pedestrian, shall be restricted to the amount of alcoholic beverages which are exempt from the payment of duty in accordance with existing provisions of federal law. Such alcoholic beverages shall be exempt from state licensing restrictions.

The provisions of this section are not applicable in the case of alcoholic beverages shipped into this state from without the United States by an adult member of the armed forces of the United States, serving outside the confines of the United States, for his personal or household use within the state in such quantity of alcoholic beverages as is exempt from the payment of duty under existing provisions of the Federal Tariff Act or regulations. Such alcoholic beverages may be brought into this state only by common carrier and consigned to the premises of a licensed importer or customs broker, or to a licensed importer or customs broker at the premises of a public warehouse licensed under this division. Notwithstanding any other provisions of this division, the holder of an importer's license, a customs broker's license, or a public warehouse license, may make delivery of such alcoholic beverages as may be brought into this state under the provisions of this paragraph directly to the owner thereof upon satisfactory proof of identity. Such delivery shall not be deemed to constitute a sale in this state.

A manufacturer of distilled spirits may transport such distilled spirits into this state in motor vehicles owned by or leased to the manufacturer, and operated by employees of the manufacturer, if:

(a) Such distilled spirits are transported into this state from a place of manufacture within the United States; and

(b) The manufacturer holds a California distilled spirits manufacturer's license; and

(c) Delivery is made to the licensed premises of such distilled spirits manufacturer.

23661.1. Importation of alcoholic beverages into State by adult passenger on board chartered flight. Notwithstanding any other provision of law, an adult passenger on board a chartered airplane on a flight which commences and terminates in the continental United States and which does not land outside the continental United States, may bring not to exceed one quart of alcoholic beverages into this State for household or personal use. Such alcoholic beverages shall be exempt from state licensing restrictions. No person shall bring in more than one quart of alcoholic beverages during any calendar year pursuant to the authority granted in this section.

23661.2. Permit to receive shipment of wine from another state. Notwithstanding any other law, an individual or retail licensee in a state that affords California retail licensees or individuals an equal reciprocal shipping privilege, may ship, for personal use and not for resale, no more than two cases of wine (no more than nine liters each case) per month to any adult resident in this state. Delivery of a shipment pursuant to this subdivision shall not be deemed to constitute a sale in this state.

The shipping container of any wine sent into or out of this state under this section shall be clearly labeled to indicate that the container cannot be delivered to a minor or an intoxicated person.

History.—Stats. 2005, Ch. 157 (SB 118), in effect January 1, 2006, deleted the former subdivision (a), deleted the former subdivision letter (b), added "retail" after "an individual or" and "that affords California", respectively, in first paragraph, substituted "container" for "package" after "to indicate that the", and deleted "to" after "to a minor or" in the second paragraph.

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23661.3. Wine direct shipper permit. (a) Notwithstanding any law, rule, or regulation to the contrary, any person currently licensed in this state or any other state as a winegrower who obtains a wine direct shipper permit pursuant to this section may sell and ship wine directly to a resident of California, who is at least 21 years of age, for the resident's personal use and not for resale.

Before sending any shipment to a resident of California, the wine direct shipper permitholder must:

(1) File an application with the department.

(2) Pay a ten-dollar ($10) annual registration fee if the winegrower is not currently licensed by the department.

(3) Provide the department its California alcoholic beverage license number or a true copy of its current alcoholic beverage license issued by another state.

(4) Obtain from the department a wine direct shipper permit.

(5) Obtain a seller's permit or register with the State Board of Equalization pursuant to Part 1 (commencing with Section 6001) of Division 2 of the Revenue and Taxation Code.

(b) A wine direct shipper permit authorizes the permitholder to do all of the following:

(1) Sell and ship wine to any person 21 years of age or older for his or her personal use and not for resale.

(2) Ship wine directly to a resident in this state only in containers that are conspicuously labeled with the words: "CONTAINS ALCOHOL: SIGNATURE OF PERSON AGE 21 YEARS OR OLDER REQUIRED FOR DELIVERY."

(3) Ship wine only if the permitholder requires the carrier to obtain the signature of any individual 21 years of age or older before delivering any wine shipped to an individual in this state.

(4) If the permitholder is located outside of this state, report to the department no later than January 31 of each year, the total amount of wine shipped into the state during the preceding calendar year under the wine direct shipper permit.

(5) If the permitholder is located outside of this state, pay to the State Board of Equalization all sales and use taxes, and excise taxes on sales to residents of California under the wine direct shipper permit. For excise tax purposes, all wine sold pursuant to a direct shipper permit shall be deemed to be wine sold in this state.

(6) If located within this state, provide the department any necessary additional information not currently provided to ensure compliance with this section.

(7) Permit the department or the State Board of Equalization to perform an audit of the wine direct shipper permitholder's records upon request.

(8) Be deemed to have consented to the jurisdiction of the department or any other state agency and the California courts concerning enforcement of this section any related laws, rules, or regulations.

(d) A wine direct shipper permitholder located outside of the state may annually renew its permit with the department by paying a ten-dollar ($10) renewal registration fee and providing the department with a true copy of its current alcoholic beverage license issued by another state. A wine direct shipper permitholder located in California shall renew its wine direct shipper permit in conjunction with its master license. For purposes of this section, "master license" means a winegrower's license issued by the department.

(e) The department and the State Board of Equalization may promulgate rules and regulations to effectuate the purposes of this law.

(f) The department may enforce the requirements of this section by administrative proceedings to suspend or revoke the wine direct shipper permit, and the department may accept payment of an offer in compromise in lieu of suspension as provided by this division. Any hearing held pursuant to Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code against a permitholder outside of California shall be held in Sacramento.

(g) Sales and shipments of wine direct to consumers in California from winegrowers who do not possess a current wine direct shipper permit from the department are prohibited. Any person who knowingly makes, participates in, transports, imports, or receives such a shipment is guilty of a misdemeanor pursuant to Section 25617.

History.—Added by Stats. 2005, Ch. 157 (SB 118), in effect January 1, 2006.

States may regulate direct shipment of wine as long as it does not discriminate.—U.S. Supreme Court held that New York and Michigan wine direct shipping statutes were unconstitutional because they discriminated against out-of-state wine growers and interstate commerce, but states could regulate direct shipment of wine, such as by requiring the out-of-state shipper to obtain a permit, as long as such regulation does not discriminate in favor of in-state wine producers and against out-of-state wine producers. Granholm v. Heald (2005) 125 S.Ct. 1885.

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23661.5. Producer's transportation of wine or beer into this state by vehicle owned or leased. A person who manufactures or produces wine or beer outside of this state, but within the United States, in accordance with the requirements of the laws of the United States, may transport such wine or beer into this state, in a vehicle owned and operated by the manufacturer or producer or operated by him pursuant to a lease the term of which is not less than 30 days, or by contract carrier, for delivery to a licensee who is authorized under this division to import the wine or beer into this state, if:

(a) The delivery is made at the premises of the licensee or to a licensee or a licensed customs broker at the premises of a public warehouse licensed under this division; and

(b) The manufacturer or producer holds a manufacturer's interstate alcoholic beverage transporter's permit under Section 32110 of the Revenue and Taxation Code.

23661.6. Right of wine grower to return previously exported wine in vehicles owned or controlled by the wine grower. A licensed winegrower who in the course of business exports wine from this State to another state, may subsequently return to his licensed premises in this State all or any portion of such wine in private vehicles owned or under the control of the winegrower. Any wine so returned shall be subject to the provisions of Section 32175 of the Revenue and Taxation Code.

23661.7. Right of purchaser to return wine removed from state. (a) A person who has purchased wine from a licensed winegrower or a holder of a beer and wine wholesaler's license and an off-sale retail license that only sells wine, has taken delivery of that wine within this state for delivery or use without the state, and has removed that wine from the state, may return all or any portion of that wine to the licensed premises of the winegrower or holder of a beer and wine wholesaler's license and an off-sale retail license that only sells wine in this state from whom the wine was purchased. To make a return the purchaser need not obtain any license in this state, and may return the wine in a vehicle owned or controlled by the purchaser.

(b) The provisions of Section 32175 of the Revenue and Taxation Code shall apply to any wine so returned.

History.—Stats. 2010, Ch. 276 (SB 806), in effect January 1, 2011, added subdivision letter (a) to the first two sentences of the former sole paragraph, added "or holder of a beer and wine wholesaler's license and an off-sale retail license that only sells wine" after "winegrower", and substituted "that" for "such" after "has taken delivery", "has removed", and after "or any portion", throughout the first sentence, substituted "a" for "such" after "To make" and substituted "the" for "such" after "controlled by" in the second sentence, of relettered subdivision (a); and lettered the third sentence of the former sole paragraph as subdivision (b).

23662. When shipment deemed consigned to licensed importer. A shipment shall be deemed to be consigned to a licensed importer, although originally consigned to a person not so licensed, when the shipment is, before delivery and without leaving the possession of the common carrier transporting it, reconsigned or diverted in transit by either the consignor or consignee to a licensed importer to whom final delivery by the common carrier is made.

23663. When shipment presumed for delivery and use within state. Alcoholic beverages which are consigned to a destination within this State shall be presumed to be for delivery or use within this State.

23664. Railroad or other carrier carrying interstate or foreign passengers not deemed importer for sale of beverages on carrier. A railroad, sleeping car, dining car, boat, or steamship company or air common carrier carrying interstate or foreign passengers on trains, boats, or airplanes shall not be deemed to be an importer or subject to an importer's license for bringing into this State alcoholic beverages for the purpose of sale within this State on the trains, cars, boats, or airplanes on which the alcoholic beverages are brought into this State exclusively to passengers or employees not on duty, and for carrying the same alcoholic beverages or any unsold portion thereof out of this State in due course of operation.

23666. Seizure of beverages imported contrary to provisions. Alcoholic beverages imported into this State contrary to the provisions of Sections 23661 to 23664, inclusive, shall be seized by the department.

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23667. Receipt of beverages transported and delivered by common carriers. Common carriers transporting alcoholic beverages into this State for delivery or use within this State or common carriers making delivery of alcoholic beverages so transported shall obtain from the licensed importer or customs broker a receipt on a form prescribed by the department for the alcoholic beverages so transported and delivered. If the consignee refuses to give the receipt and show his license to the carrier, the carrier is relieved of all responsibility for delivery of the alcoholic beverages.

23668. Refusal of consignee not a licensed importer or custom broker to give receipt and show license. Subject to the provisions of Section 23662, whenever the consignee is not a licensed importer or customs broker or whenever the consignee refuses to give his receipt and show his license, the carrier shall immediately notify the department at Sacramento giving full details as to the character of shipment, point of origin, destination, and address of the consignor and consignee, and within 10 days the alcoholic beverages shall be delivered to the department and shall be forfeited to the State.

23669. Payment of common carrier's unpaid freight and storage proceeds of sale of seized or forfeited beverages. If any alcoholic beverages seized under Section 23666 or forfeited under Section 23668 are sold by or under the direction of the department, the common carrier's unpaid freight and storage charges accruing on the shipments of the alcoholic beverages shall be satisfied out of the proceeds of any sale made by the State after deducting the cost of the sale and any excise taxes accruing thereon.

23670. Violation of provisions a misdemeanor. Every person violating the provisions of this article is guilty of a misdemeanor.

23671. Importation of beer for sale in State. No beer importer shall purchase any beer not manufactured within the state or cause any beer to be transported into the state for sale in the state, unless the out-of-state vendor making shipment of the beer into the state holds a certificate of compliance issued by the department. A certificate of compliance shall be granted when the out-of-state vendor makes a written agreement with the department to furnish to the board, on or before the 10th day of each month, a report on a form prescribed by the board, showing the quantity of beer shipped by the out-of-state vendor to each licensed beer importer in this state during the preceding month. The out-of-state vendor shall further agree that it and its agents and all agencies within this state controlled by it will comply with all laws of this state and all rules of the department with respect to the sale of alcoholic beverages, including, but not limited to, Chapter 12 (commencing with Section 25000) of Division 9, and Section 25509, to the same extent as licensees.

If any out-of-state vendor, after obtaining the certificate, fails to submit the report or to comply with Section 14575 of the Public Resources Code, the department may suspend or revoke the certificate of compliance in the manner provided for the suspension or revocation of licenses, and after a hearing which shall be held in the City of Sacramento or in any other county seat in this state which the department determines to be convenient to the holder of the certificate. No fee shall be charged for the certificate of compliance which shall remain in effect until revoked by the department.

23672. Designation of licensed importer as authorized importer of brand. A licensed importer shall not purchase or accept delivery of any brand of distilled spirits unless he is designated as an authorized importer of such brand by the brand owner or his authorized agent. Such distilled spirits imported into California shall come to rest at the warehouse of the licensed importer or an authorized warehouse for the account of such licensed importer, before sale and delivery to a retail licensee.

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23673. Distilled spirits; price to wholesaler or rectifier. No brand owner of distilled spirits or his agent shall sell any brand of distilled spirits to a wholesaler or rectifier in this state at a price higher than the lowest price at which such brand of distilled spirits is sold by such brand owner or his agent to any wholesaler or rectifier during any calendar month anywhere in any other state or in the District of Columbia or to any state or state agency which owns or operates retail distilled spirits stores.

In determining the lowest price for which any brand of distilled spirits is sold in any other state or the District of Columbia or to any state or state agency which owns and operates retail distilled spirits stores, appropriate reduction shall be made to reflect all discounts, all rebates, allowances, and other inducements of any kind whatsoever offered or given to any such wholesaler or state, or state agency, as the case may be, purchasing such brand of distilled spirits in such other state or in the District of Columbia or to the state or state agency which owns or operates retail distilled spirits stores; provided that nothing in this section shall prevent differentials in price which make only due allowance for differences in state excise taxes and fees and the actual cost of delivery. As used in this section, the term "excise taxes and license fees" shall mean the excise taxes imposed or the fees required by any state or the District of Columbia. A violation of this section shall be remediable only by a civil action for damages or an action to enjoin a brand owner or his agent from continued violation brought by any person suffering loss as a result of such violation. A judgment in any such action rendered against a licensee shall be deemed grounds for the suspension or revocation of the violator's license pursuant to Chapter 7 (commencing with Section 24200) of this division. For the purposes of this section, "distilled spirits" does not include brandy produced in California. No California brandy manufacturer or his agent shall be required to file an affidavit pursuant to this section for California brandy.