Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2018

Sales and Use Tax Annotations

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Annotation 295.1330


295.1330 Fabrication Labor. Calibration and other start up procedures performed on flow meters by the out-of-state manufacturer, at its facility rather than the customer's jobsite during installation, is fabrication labor and part of the gross receipts from the sales of the flow meters. This is true, even though the charges for such procedures are separately stated on the invoice of sale. The retail sale of such meters to California consumers is subject to use tax, and the manufacturer is required to collect the tax if it is engaged in business in this state or holds a seller's permit here. In addition, if the out-of-state manufacturer ships these meters to a California consumer, pursuant to a retail sale made by another out-of-state retailer who is not engaged in business in California, the manufacturer has made a retail sale pursuant to Revenue and Taxation Code section 6007. When this occurs, the manufacturer is considered the retailer and must report the retail selling price of the property, charged by the out-of-state retailer to the consumer, as part of its gross receipts or sales price. 10/12/93.