Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2014
 

Sales and Use Tax Annotations


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F

235.0000 FEDERAL TAXES—Regulation 1617

Annotation 235.0120

235.0120 Ozone-Depleting Chemicals. The federal excise tax, effective January 1, 1990, imposed by section 4681 of the Internal Revenue Code on ozone-depleting chemicals is a manufacturers' tax and is included in gross receipts subject to sales tax and the sales price subject to use tax. Section 4681 imposes a tax on any ozone-depleting chemicals sold or used by the manufacturer, producer, or importer thereof, and on any imported taxable product sold or used by the importer thereof.

The federal excise tax imposed by section 4682 of the Internal Revenue Code on any ozone-depleting chemical held on January 1, 1990, by other than a manufacturer, producer or importer thereof is not subject to California use tax. The use tax is measured by the purchase price and the federal excise tax imposed after the sale, self declared and paid directly to the United States on tangible personal property is not subject to the use tax. Section 4682(h) imposes a tax on any ozone-depleting chemical which is held by any person, on January 1, 1990, for sale or for use in further manufacture.

Section 4681 is also imposed on any imported taxable product sold or used by the importer hereof. The amount of the tax is the estimated value deemed to represent the cost of any ozone-depleting chemical used as material in the manufacture of the product and is paid directly to the United States. This self-declared federal excise tax is not to be included in the purchase price subject to California use tax if the product is used by the importer, as the consumer. However, if the product is sold and the federal excise tax is recovered as an expense, tax will apply whether the excise tax is separately stated or included in the selling price. 4/17/90; 6/28/91.