Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2016

Sales and Use Tax Annotations

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Annotation 220.0260

220.0260 Telephone Service. An out-of-state retailer who has orders taken by an "800" telephone number service located in California is a "retailer engaged in business in this state." The "800" telephone number service is a representative operating in this state under the authority of the retailer for the purpose of taking of orders as provided in Revenue and Taxation Code section 6203(b). Accordingly, such out-of-state retailers will be required to register with the Board and collect and report use tax on sales of tangible personal property to consumers in California.

If an order for an out-of-state retailer is taken by an "800" telephone number service located in California and the property is sent from an out-of-state location to an in-state location, use tax will apply.

Retailers located in California will be required to report and pay either sales or use tax whenever a taxable sale is made to a California consumer for delivery in this state. If delivery is from within California to an out-of-state location, tax will not apply provided the property is shipped to the out-of-state location by facilities operated by the retailer or by delivery to a carrier, customs broker, or forwarding agent for shipment to such out-of-state location. This would be true whether or not the order was placed by an in-state or out-of-state consumer.

If the consumer is located out-of-state, the retailer is located out-of-state, and the property purchased is sent from the location of the out-of-state retailer to an out-of-state location, neither sales nor use tax will apply to the sale even though the order is placed through an "800" number located in California. 1/30/81.