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 325.0108

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

325.0108 Sale of Tanker Trucks to Out-of-State Customer. A taxpayer is a manufacturer and retailer of tanker trucks. The taxpayer acquires a truck cab and chassis from a truck manufacturer and then acquires a tank from a tank manufacturer. The taxpayer installs the tank and accessories onto the truck chassis. After completion of manufacture, the taxpayer sells the complete truck package to California customers and to out-of-state customers. Currently, when the taxpayer sells a tanker truck to an out-of-state customer, the taxpayer delivers the truck to the customer outside California. However, the taxpayer would like to begin delivering the trucks to its out-of-state customers at its California business location. The taxpayer asks, assuming its customers meet the documentation and time requirements of section 6388 and 6388.5, whether these transactions would qualify for exemption from tax under these provisions.

Since section 6388.5 only applies to trailers and semi-trailers, the exemption provided by this section is not available with respect to tanker trucks constituting a single unit. [Vehicle Code section 410 (motor truck).]

The exemption provided by section 6388 is applicable to the sale of a new or remanufactured vehicles which have an unladen weight of 6,000 pounds or more. This section applies to trucks. However, one of the conditions for the application of this exemption is that the vehicle is purchased from a dealer outside California. Since the taxpayer is a California dealer, the sales also would not qualify for the section 6388 exemption. 2/6/92.