Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2018

Sales and Use Tax Annotations

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Annotation 220.0119

220.0119 Independent Representative. An out-of-state retailer has no office or property in California. The retailer's only contact with customers in California is through an independent representative who also is a representative for other companies. The representative calls on customers and forwards all orders to the out-of-state retailer. Upon completion of the work, the product is shipped via common carrier FOB shipping point to the California customer.

The phrase "under the authority of" in section 6203(b) refers to any relationship pursuant to which any power whatsoever is delegated by an out-of-state retailer to its California representative. Therefore, the out-of-state retailer is engaged in business in this state because it has a sales representative who is physically located in California and that person solicits sales of tangible personal property under power delegated to that person by the out-of-state retailer. As such, the out-of-state retailer must collect the applicable use tax from all of its California customers and pay that tax to this state, without regard to whether the purchase is made through the California solicitor, or entirely by mail or telephone. 11/2/95.