Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2017

Sales and Use Tax Annotations

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Annotation 295.0420


295.0420 Out-of-State Fabrication. A fabrication contractor entered into a contract with the City and County of San Francisco to assemble and install in California two generators the parts for which were to be shipped from Germany. However, the contractor had the generators fully fabricated in Germany before shipment to California. The fabrication labor which the contractor purchased in Germany and resold in San Francisco as part of the fabricated generators was subject to sales tax because the intangible labor was for fabrication of tangible personal property. Fabrication charges for labor performed in California and included in the purchase price of the generators would also be taxable if the fabrication were done by the contractor in California. 2/4/70.