Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2017
Sales and Use Tax Annotations
325.0000 INTERSTATE AND FOREIGN COMMERCE—Regulation 1620
(c) SHIPMENTS FROM CALIFORNIA TO POINTS OUTSIDE STATE
(8) Use Tax
325.1768 Space Flight Property. Taxpayer will sell a spacecraft for delivery in a foreign country with title passing upon delivery in the foreign country. The spacecraft will be integrated with its payload in the foreign country and will then be returned to the taxpayer in California. The taxpayer will inspect the spacecraft for damage, install batteries, and ship it to Vandenberg Air Force Base (VAFB). At VAFB, the spacecraft will be assembled. The launch vehicle then will be attached to an airplane in "launch ready condition." The airplane will be flown to Florida for "reflecting and final checking out." Then, the airplane will be flown to a point over the Atlantic Ocean for launch.
Section 6380 provides an exemption from the sales and use tax for "qualified property" used in space flight originating at VAFB. In this case, the only flight that will originate from VAFB is not a space flight but, instead, a conventional flight from California to Florida. Thus, the spacecraft does not qualify for the exemption provided under section 6380. There are insufficient facts to determine whether section 6009.1 applies to the transaction. 6/7/94.