Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2013
Sales and Use Tax Annotations
330.0000 LEASES OF TANGIBLE PERSONAL PROPERTY—IN GENERAL—Regulation 1660
(a) IN GENERAL
330.2719 Renting Medical Ventilators to Hospitals. A lessor rents ventilators to hospitals, usually on an hourly or daily basis. The lessor only rents to hospitals because the expertise of a respiratory therapist is needed to correctly operate the equipment. The hospitals use the ventilators for patients who need assistance to breathe. Possession or control of the equipment is not passed to the hospital's patients since the ventilators are too complicated to be operated by anyone but a trained respiratory therapist.
The hospital is not considered to be sub-leasing or reselling the ventilator to the patient merely because it bills the patient for use. The equipment is being used by the hospital in providing a service. Also, this transaction does not qualify for exemption under section 6369.5 since it must be rented to an individual, not to a hospital, in order to qualify for the exemption. Accordingly, the rental charges to the hospital are subject to tax. 3/11/92.