Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2013
Sales and Use Tax Annotations
250.0000 FOREIGN CONSULS—Regulation 1619
(a) SALES TAX
250.0025 Corporation Owned by Foreign Government. A taxpayer is a corporation, organized under the laws of the Commonwealth of Australia, and solely owned by the Australian government. Under Internal Revenue Code section 892, this corporation would be treated as a foreign government for United States tax purposes. The question was posed if this corporation would be considered a foreign government under the California Sales and Use Tax Law.
California does not have an equivalent code section or regulation to Treasury Regulation section 1.892–2T. California makes no distinction between corporations owned or controlled by foreign government and any other corporation. (See Annotation 250.0190 (07/25/90).)
Accordingly, if the corporation makes sales of tangible personal property at retail in this state, or stores, uses or otherwise consumes tangible personal property purchased from a retailer for use in this state, the corporation would not be exempt from the application of the Sales and Use Tax Law in California. Further, sales to the corporation are not exempt from sales tax. 7/15/96.