Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2013
Sales And Use Tax Court Decisions
Philips and Ober Electric Co. v. State Board of Equalization . . . (1991)
Taxpayer was a subcontractor who sold tangible personal property to a construction contractor. Taxpayer collected and paid sales tax. The contractor later determined that the tangible personal property was "machinery and equipment" and therefore eligible for a resale certificate under Regulation 1521. The contractor provided taxpayer with a resale certificate, and taxpayer refunded the sales tax to the contractor. On the next sales and use tax return, taxpayer claimed a credit for the refunded sales tax, instead of filing a claim for refund. When taxpayer was audited five years later, the credit was disallowed. Taxpayer then filed suit for refund. The court of appeal held that it had no jurisdiction to grant relief because taxpayer had failed to exhaust its administrative remedies by filing a claim for refund with the Board. An improper tax-paid purchases resold credit cannot be used to avoid the requirement of a timely claim for refund. Philips and Ober Electric Co. v. State Board of Equalization (1991) 231 Cal.App.3d 723.