Senator Seyarto's proposal to amend California's Revenue and Taxation Code would make permanent the current sales and use tax exemption for all-volunteer fire departments, which is set to expire on January 1, 2026. The exemption allows qualifying departments to operate as consumers rather than retailers when selling tangible personal property, provided their profits are used exclusively for departmental purposes.

The bill maintains existing eligibility requirements for all-volunteer fire departments, including that members may receive per-incident compensation but not regular salaries, and that departments must qualify as tax-exempt organizations with official government recognition. Departments whose gross receipts from tangible personal property sales exceed $100,000 in each of the previous two calendar years would not qualify for the exemption. The California Department of Tax and Fee Administration must annually estimate and report to the Legislature any revenue losses associated with this tax expenditure.

Local agencies would not receive state reimbursement for sales and use tax revenue losses resulting from this exemption, as the bill explicitly excludes such compensation. The measure would take effect immediately upon enactment as a tax levy under the California Constitution.