Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2013
Sales and Use Tax Annotations
195.0000 CONTAINERS AND LABELS—Regulation 1589
(a) IN GENERAL—NONRETURNABLE CONTAINERS
195.0650 Nonreturnable Type Containers. Company A sells nonreturnable containers to Company C. Company B sells dishes to C. C directs A to deliver the nonreturnable containers to B in California, who packs the dishes (sold to C) into the containers and ships them to C out of state. Company A's sale of the containers will be nontaxable only if C resells the dishes, and does so in the very containers purchased from A, without C's making any other use of the containers. If C does not resell the dishes, A's sale of the containers is subject to sales tax. If C resells the dishes but unpacks them from the containers purchased from A and repacks them into other containers (or does not repack them in any containers), A's sale of containers to C is subject to sales tax. 10/2/89.