Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2014
 

Sales and Use Tax Annotations


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I

325.0000 INTERSTATE AND FOREIGN COMMERCE—Regulation 1620

Annotation 325.0057

(a) IN GENERAL—SHIPMENTS INTO CALIFORNIA FROM POINTS OUTSIDE STATE

325.0057 Installation by Out-of State-Vendor. A vendor performs repairs on property it sells, but does not do so pursuant to maintenance contracts or warranties. Rather, it makes a charge for repairs, separately stating the charge for parts it furnishes. The vendor keeps the repair parts at its out-of-state plant. The repair parts are sent to California by one of two methods: (1) repair parts to replace parts which break frequently are sent by the vendor from its out-of-state plant to its in-state employees prior to knowing who the ultimate customer will be, or; (2) repair parts to replace parts which break infrequently are sent by the vendor from its out-of-state plant to its in-state employees only after an initial field visit to the ultimate customer. In both of these methods of delivery, the field service employee personally hand carries the repair parts to the customer's location at the time the repair is made. The vendor is making a retail sale of the repair parts inside this state since delivery of the part is made by an in-state field employee of the vendor. Since the in-state employee operates from a location of the vendor in California, sales tax applies to the separately stated charges for the repair parts. 5/20/96.