Laws, Regulations and Annotations
Business Taxes Law Guide – Revision 2022
Alcoholic Beverage Tax Law
California Constitution, Article XX, State Control of Liquor
Sec. 22. The State of California, subject to the internal revenue laws of the United States, shall have the exclusive right and power to license and regulate the manufacture, sale, purchase, possession and transportation of alcoholic beverages within the State, and subject to the laws of the United States regulating commerce between foreign nations and among the states shall have the exclusive right and power to regulate the importation into and exportation from the State, of alcoholic beverages. In the exercise of these rights and powers, the Legislature shall not constitute the State or any agency thereof a manufacturer or seller of alcoholic beverages.
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The Department of Alcoholic Beverage Control shall have the exclusive power, except as herein provided and in accordance with laws enacted by the Legislature, to license the manufacture, importation and sale of alcoholic beverages in this State, and to collect license fees or occupation taxes on account thereof.
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The State Board of Equalization shall assess and collect such excise taxes as are or may be imposed by the Legislature on account of the manufacture, importation and sale of alcoholic beverages in this State.
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The Legislature shall provide for apportioning the amounts collected for license fees or occupation taxes under the provisions hereof between the State and the cities, counties and cities and counties of the State, in such manner as the Legislature may deem proper.
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[Amendment adopted November 6, 1956.]
History—Original section adopted November 8, 1932, contained no provision relating to taxation. The amendment adopted November 6, 1934, granted to the State Board of Equalization, among other powers, "the exclusive power … to collect license fees or occupation taxes on account" of the manufacture, importation and sale of intoxicating liquors. By the amendment adopted November 2, 1954, the power to collect license fees or occupation taxes was transferred to the Department of Alcoholic Beverage Control. The 1954 amendment added the provision that the State Board of Equalization shall assess and collect the excise taxes. The amendment adopted November 6, 1956, did not relate to taxation.
Property taxation not affected.—This section does not deprive the political subdivisions of the state of the power to levy a property tax upon intoxicating liquors. Three G Distillery Corporation v. Los Angeles County, (1941) 46 Cal.App.2d 498.
Local revenue affected by state centralization of liquor control.—The provision in this section for apportioning license fees or occupation taxes is recognition of the fact that centralization of liquor control in the state government would deprive local subdivisions of the state of a potential source of revenue. Roehm v. County of Orange, (1948) 32 Cal.2d 280.
Municipal excise tax validly applied to purchases of intoxicating liquors.—Section 22 of Article XX of the State Constitution, reserving to the state the "exclusive … power to … regulate" the "sale" and "purchase" of intoxicating liquor is not violated by application to the sale of intoxicating liquors of a municipal ordinance imposing an excise tax on the purchase at retail of tangible personal property and requiring collection of the tax from the purchaser by the retailer. Ainsworth v. Bryant, (1949) 34 Cal.2d 465.
Jurisdiction. —The classification of alcoholic beverages under the Alcoholic Beverage Control Act and the Alcoholic Beverage Tax Law is within the exclusive jurisdiction of the Department of Alcoholic Beverage Control, and the Board cannot adopt its own definitions for taxation purposes. Diageo-Guinness USA, Inc. v. Board of Equalization (2012) 205 Cal.App.4th 907.