Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2015
Sales and Use Tax Annotations
195.0000 CONTAINERS AND LABELS—Regulation 1589
(a) IN GENERAL—NONRETURNABLE CONTAINERS
195.0508 Intervening Use. A manufacturer of dehydrated food products purchases fiber drums and places dehydrated food products inside. The drums together with the contents are shipped to a distribution center. Ordinarily, the drums together with the contents are shipped from the distribution center to the customers. However, in some cases, the customer wants the product in a container of a different size and shape. In this case, the product is removed from the fiber drum and repackaged in a container desired by the customer. The fiber drum is returned to the manufacturing plant for refilling and subsequent distribution.
The use of the fiber drums to transport goods from the manufacturing plant to the distribution center and the subsequent removal of the product from the drums constitutes a use and tax is due on the purchase price of any drum so used. The subsequent sale of the drum together with the contents does not affect the tax liability incurred by the above-described intervening use. 8/22/90.
(Note: Statutory change to section 6364, operative April 1, 2000, re food containers.) (Am. 2000–2).