Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2017
Sales and Use Tax Annotations
190.0000 CONSTRUCTION CONTRACTORS—Regulation 1521
(c) MEASURE OF TAX
190.2580 United States Construction Contractor. A construction contractor acquires property outside California and title is immediately transferred to the United States. At the time the property enters California, it is already owned by the United States. Its use by the United States is exempt from tax.
If the sale to the construction contractor occurs in California and the property is used for the construction of improvements to real property in this state, under sections 6007.5 and 6384 the sale to the construction contractor is a retail sale subject to tax. Since the sale to the construction contractor in California is a retail sale, the fact that title may thereafter pass to the United States is immaterial. The retail sale of such property to the construction contractor in California is subject to sales or use tax. If the construction contractor gives the seller a resale certificate, the construction contractor is liable for use tax. 7/24/91.